How much does a Financial Advisor really cost?

Ever wondered what it really costs to secure your financial future in Australia? The answer might surprise you and it’s not just about the numbers.

Not just the dollars you hand over, but the stakes you’re playing with? One misstep like trusting the wrong advisor or skipping advice altogether could wipe out a decade of hard-earned progress.

At Tenex Wealth, we’re here to cut through the clutter and give it to you straight. Australians pay around $4,000 a year for ongoing financial advice. However, the majority of the work is completed in the first twelve months. This will include a Statement of Advice outlining what you get, why it’s in your best interest and how you win. Think retirement strategies, tax optimisation, investment blueprints, wealth creation, financial plan B and insurance protection. That’s $5,000 to $12,000 upfront.

Why the difference? It’s all about complexity. A retiree with a modest portfolio is a two-bedroom fixer-upper, a business owner with family trusts, bucket companies, investment companies and self-managed super funds? That’s an 8-bedroom mansion with a pool.

But here’s the real question: what if the cost of not getting advice is the one you can’t afford? In this guide, we’ll unpack the numbers, reveal the value, and arm you with the right questions to ask because your future isn’t a roll of the dice. Let’s dive in.

The Big Picture: What’s the Average Cost?

How much does a Financial Advisor really cost?

Let’s start with the baseline. Australians shell out about $4,000 a year for ongoing financial advice. This gets you think regular 12 monthly check-ins with your advisor, portfolio tweaks, market updates and tax optimisation. For an upfront, all-in plan covering retirement, tax minimisation, and wealth-building strategies you’re looking at $5,000 to $12,000. Some advisors even charge hourly, ranging from $275 to $550. So why the spread? It’s not random. Complexity drives the price. A pre-retiree with a simple super account needs less heavy lifting than an entrepreneur or high income earner juggling a family trust, a self-managed super fund (SMSF), and a rental property empire.

Quick Snapshot:

· Ongoing advice: ~$4,000/year

· Comprehensive plans: $5,000–$12,000 upfront

· Hourly rates: $275–$550/hour

What are you Actually Paying For? (And why It’s Worth Every Cent)

· Tailored Precision: No generic templates. Your retirement roadmap, tax strategy, and investment structuring, estate planning consideration and insurances are custom-built for your life whether you’re a business owner scaling up, someone looking to be strategic wealth building or a pre-retiree winding down.

· Ongoing Lifeline: Markets crash, laws change, life throws curveballs. Your advisor keeps your plan agile. One slip without that support? A decade of growth could vanish.

· Priceless Calm: Sleep better knowing experts are steering the ship. How much is that worth when the stakes are your family’s future?

At Tenex Wealth, we don’t just crunch numbers we craft outcomes. For high-income earners and entrepreneurs, that means strategies that evolve with your goals, not against them.

Fee Structures Unpacked- Fee only vs Percentage Based Advisors

Most financial advisors will charge a percentage-based fee for assets under management. This will be in the range of 0.5% to 1.5% of assets. So, for a $1,000,000 superannuation balance you can expect a fee of $5,000 to $15,000. If you’re financial advisor doesn’t accurately articulate how they charge fee’s then they are charging a percentage-based fee.

Few, but not many will charge a Fee Only for Financial Advice. Meaning that they don’t mind how much money you have, they only want to get paid for the work they do. This also varies depending on what they are actually doing for you at any one stage. The more complexity, the more work, the higher the fee. The more simplicity, the lower the fee. On average a Fee only, financial advisor will charge anywhere from $5,000 to $12,000 for an upfront Statement of Advice.

· Fixed fees: $5,000–12,000 upfront, based on depth.

· Asset-based: 0.5%–1.5% of your portfolio.

· Hourly rates: $275–$550/hour.

Ask yourself: “What’s included? Is there a model that grows with me?” Good advisors love those questions.

Hybrid Fee Structures

In today’s ever-changing financial world, hybrid fee structures are becoming more popular. This approach combines an ongoing fee with a percentage-based fee, so you pay a lower percentage fee while your portfolio is growing and then switch to a flat fee once your investments reach a certain size.

This flexible setup can be a great fit if you have a large portfolio that’s expanding quickly. But like with any fee model, it’s important to think about factors like:

· Your investment goals

· The size of your portfolio

· How much you expect it to grow

· The risks in the market

The Shifting Landscape: Why Fees Are Rising (And What It Means for You)

Here’s a stat to chew on, financial advice fees are up 40% in recent years. Why? Blame the Royal Commission it tightened regulations, slashed advisor numbers by 50%, and jacked up compliance costs. Post-Royal Commission, advisors spend 30% more time on paperwork, think audits, disclosures, and client consents. That’s time they’re not spending on your portfolio. Compliance costs climbed, and with fewer advisors in the game demand outstrips supply.

The Value Proposition: What’s at Stake?

For simple setups, fees can feel like a pinch. But for complex lives businesses, big portfolios, tax mazes the payoff smokes the cost. Studies peg advisor value at 1.5% to 4% extra returns annually over decades. Before you balk, flip it: “What’s the cost of DIY disaster?”

Are Financial Advice Fee’s Tax Deductable?

When considering the cost of financial advice, note that tax deductions are available for investment and Tax planning services.

The Australian Taxation Office (ATO) in Australia allows specific deductions for investment advice and financial planning services. This can be a tax benefit for individuals who seek professional advice.

These deductions are for income-generating investments, so fees for investment advice may be tax-deductible. This doesn’t mean the cost of financial advice goes away, but it can help offset it.

For more information on this visit the Australian Taxation Office’s Financial Advice fees page here.

Quick Tip: How to Claim It

Get itemized invoices from your advisor, make sure they specify “investment advice” or “tax planning,” not vague fluff like “consulting.” Link it to income-producing assets (not personal budgeting). Hand it to your accountant and watch the magic happen.

Summary

In today’s busy financial world, it’s important for you to understand how much a financial advisor might cost. Financial advice comes in different shapes fixed fees, asset-based pricing, and hourly rates each fitting different needs and preferences.

Whether you’re looking for help with managing your investments, planning your personal finances, or handling your wealth, knowing the costs upfront will help you make smarter decisions.

The key is finding an advisor who truly understands your financial goals and offers value that makes their fees worthwhile.

Remember, the aim isn’t just to spend money on advice but to invest in your future with confidence.

Understanding how much a financial advisor costs can help you make an informed choice that benefits your long-term financial health.

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