Transparency is the key when using a financial advisor and the fees are coming down. The regulatory body wants this and I also fully support this. It will be good for the client and the industry.
When a client is offered a product, why are they so often offered a higher fee product when there is a low costing product that will give higher returns?
Ie 1% vs 8% in fees or 7 pct annual returns vs 0%
When these rules are implemented here, it will eliminate many conflicts of interest between the clients and the advisors.
Now I have heard the crocodile tears of many advisors when they say, these rules are unfair as it will make it financially unfeasible to service small accounts.
The feedback I get from people, is that they are never serviced properly. Most of them were put into high commission products and the minute the advisor left the building with the cheque, that was the last you heard from them, unless they were trying to sell another product.
Personally I like the better transparency and more accountability as well as lower fees. This will increase the long term returns for the clients, and more volume for the advisor.
Watch this space as I will be announcing something shortly.