Since 31 December 2012 the FCA has required investment advisers to set their own charges for their services, instead of receiving commission from providers.
Data from the FCA shows that the value of commission earned has generally declined, while revenue from fees and charges has been on the rise since 2013.
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The FCA cites hourly rates, a fixed fee and percentage charges as examples of adviser charging methods, but says it does not set rules for what an adviser’s charging structure should look like.
However, a percentage fee based on the size of the investment is the most common method, according to data from the FCA.
Adviser charges by types offered
| | | Charge per hour (£) | % of investment | Fixed fee (£) | Combined Structure |
2021 | Initial charge | 1,135 | 3,579 | 1,750 | 734 |
| Ongoing charge | 837 | 3,792 | 973 | 611 |
2020 | Initial charge | 1,113 | 3,388 | 1,630 | 678 |
| Ongoing charge | 802 | 3,623 | 932 | 597 |
2019 | Initial charge | 1,243 | 3,604 | 1,702 | 740 |
| Ongoing charge | 921 | 3,814 | 995 | 648 |
2018 | Initial charge | 1,308 | 3,636 | 1,733 | 742 |
| Ongoing charge | 953 | 3,843 | 981 | 640 |
2017 | Initial charge | 1,393 | 3,801 | 1,775 | 772 |
| Ongoing charge | 1,034 | 3,970 | 1,023 | 666 |
2016 | Initial charge | 1,528 | 3,863 | 1,830 | 826 |
| Ongoing charge | 1,147 | 4,053 | 1,096 | 719 |
| Number of financial adviser firms. Source: Retail Mediation Activities Return |
