Understanding Ongoing Fee Arrangements

What Are Ongoing Fee Arrangements?

Many financial advisers charge ongoing fees for continuing advice and service after the initial Statement of Advice is signed. These fees may cover regular portfolio reviews, check-in meetings, updates on your situation, and access to the adviser throughout the year. Under FOFA reforms, these arrangements must be clearly disclosed and renewed annually.

What Should Your SOA Tell You?

Your Statement of Advice should clearly state the amount and frequency of any ongoing fees. Look for a fee table or section that explains what you will pay and what services you will receive in return. If this information is unclear, ask your adviser for a plain-English explanation before agreeing.

Annual Renewal Requirements

Under Australian law, ongoing fee arrangements must be renewed each year. Your adviser must send you a fee disclosure statement showing what services were provided and what fees you paid. You then have 30 days to confirm whether you want to continue the arrangement. If you do not respond, the fees must stop.

Your Right to Opt Out

You are not locked into an ongoing fee arrangement forever. You have the right to opt out at any time. If you feel you are not receiving value for the ongoing fees, or if your circumstances have changed, you can cancel the arrangement and stop future fees. Your adviser cannot charge you for services you did not agree to receive.

What If Fees Are Being Charged Incorrectly?

If you believe you have been charged ongoing fees without proper disclosure or without receiving the agreed services, you can raise this with your adviser, escalate to their licensee, or contact AFCA. The annual fee disclosure statement is a good place to start — check it against what was promised in your SOA.

How Ongoing Fee Arrangements Work

Ongoing fee arrangements involve regular payments for continuing services: annual reviews, portfolio monitoring, insurance policy reviews, and ad hoc advice. Fees are agreed in advance and documented in the Ongoing Service Agreement.

Your adviser must provide an annual fee disclosure statement within 60 days of each anniversary, including a renewal notice you must sign to continue. You must actively opt in each year.

Evaluating Whether Fees Are Worth It

Before agreeing, evaluate: how often will you meet? What specific services are provided? What is the total annual cost? Can you get the same services elsewhere for less?

Ongoing advice provides value through: peace of mind, regular reviews, proactive advice about changes, and a clear plan. If you rarely use the services, consider ad hoc advice instead.

If You Are Not Receiving Services

If paying fees but not receiving agreed services, review your fee disclosure statements. If services are missing, raise this with your adviser. You can terminate and request refunds of prepaid fees.

If unresolved, lodge a complaint through IDR or escalate to AFCA. Charging fees without providing services was a key issue from the Royal Commission.

How to Compare Ongoing Fee Arrangements

When comparing ongoing fee arrangements between advisers, look beyond the headline fee percentage. Consider: what services are included in the fee? How often will you meet with your adviser? Is there a cap on hourly charges for additional work? What is the process for terminating the arrangement? Are there any exit fees or notice periods? A lower fee is not always better value if it includes fewer services.

The total cost of advice should be weighed against the potential benefit. If ongoing advice helps you achieve better investment returns, save more tax, or avoid costly mistakes, the fees may be well worth paying. Many clients find that the value of ongoing advice — peace of mind, accountability, and proactive strategy adjustments — far exceeds the cost. Review the value annually when you receive your fee disclosure statement.

Frequently Asked Questions

How much are typical ongoing fees?
Typically $1,500-$4,000 per year for standard arrangements. Some advisers charge 0.5%-1% of assets under management.

Can I switch to ad hoc advice?
Yes. Terminate your ongoing arrangement and switch to one-off advice. Discuss with your adviser to adjust the arrangement.

What happens to my investments if I stop fees?
Your investments remain in place. The adviser stops monitoring and reviewing but your investments continue as before.

Do I pay both super fund fees and advice fees?
Yes. Super fund fees cover administration and investment management. Advice fees are separate and cover your adviser's services.

AFCA Complaints — What to Know

If you have a dispute with your financial adviser, AFCA provides free independent dispute resolution. In 2023-24, AFCA received 3,559 complaints about investments and advice. The most common issues were inappropriate advice, fees disputes, and poor disclosure. AFCA can award compensation of up to $1 million (with a $5.36 million cap for superannuation complaints). Complaints must be lodged within 6 years of the issue arising.

What Financial Advice Costs in Australia

Understanding typical advice fees helps you evaluate whether your adviser's charges are reasonable. Recent industry data provides clear benchmarks:

Fee Type	Typical Amount	Trend
Annual ongoing advice fee	$4,700 – $4,800 (median)	Up 67% over 5 years, but growth slowing to ~4%
Initial SOA / plan fee	$2,000 – $3,500	Varies by complexity
Hourly rate	$300 – $600 per hour	Higher for specialist advice
Funds under advice (FUA) fee	0.5% – 1.1% of balance	Average FUA: $758,000
Top 20% profitable practices	Nearly double median	Higher fees = leaner cost-to-serve models

Despite 68% of Australians seeing the benefit of professional financial advice, only 6% are willing to pay more than $2,500 for it. This gap between perceived value and willingness to pay is a key reason why regulatory reforms (DBFO, QAR) aim to reduce the cost of advice delivery.

If your adviser's fees are significantly above these benchmarks, ask for a clear breakdown of what you're receiving for the premium. Your SOA must disclose all fees and charges under FOFA requirements.

Sources: Adviser Ratings Australian Financial Advice Landscape 2025, Vanguard Adviser Best Practice Guide 2025, Investment Trends Adviser Business Model Report 2025.

Can I Get a Refund If My Adviser Charged But Didn't Deliver a SOA?

If your adviser charged an advice fee but did not provide the SOA you were promised, you can request a refund from the AFSL licensee in writing. Annual ongoing fee arrangements require your active consent each year — fees must stop if you do not opt in. If the licensee does not resolve it, AFCA can award compensation up to $1 million (super matters $5.36 million). Keep your fee disclosure statement and any invoice as evidence.