What Is a Financial Adviser's Ongoing Service Agreement?

What an Ongoing Service Agreement Covers

An ongoing service agreement is the arrangement between you and your financial adviser for continuing advice and support after your initial Statement of Advice is signed. It typically covers regular check-in meetings, portfolio reviews, updates on your financial situation, and ongoing access to your adviser. The agreement should clearly state what services you will receive and what they will cost.

What Your SOA Should Say

Your Statement of Advice should clearly describe the ongoing service agreement, including the frequency of reviews, the scope of ongoing advice, and the fees you will pay. If this information is missing or vague, ask your adviser to clarify before signing. You should never be asked to agree to an ongoing fee arrangement without knowing exactly what you are paying for.

Annual Renewal Requirements

Under FOFA reforms, ongoing fee arrangements must be renewed annually. Your adviser must send you a fee disclosure statement each year showing what services were provided and what fees you paid. You then have 30 days to confirm whether you want to continue. If you do not respond, the fees must stop. This is an important protection — it prevents ongoing fees from continuing indefinitely without your consent.

Your Right to Opt Out

You can opt out of an ongoing service agreement at any time. If you feel you are not receiving value from the arrangement, or if your circumstances have changed, contact your adviser to cancel. Ongoing fees cannot be charged for services you did not agree to receive.

What an Ongoing Service Agreement Covers

An Ongoing Service Agreement formalises the ongoing relationship with your adviser. It should specify: services to be provided (annual reviews, strategy monitoring, insurance reviews), fee structure (fixed fee, asset-based, or hourly), how and when fees are charged, and duration.

The agreement must also cover: your right to terminate at any time, the process for varying the agreement, the adviser's obligation to provide annual fee disclosure statements, and your obligation to opt in annually.

What to Look For

Check that: the described services match what was discussed, fees are in dollar amounts (not just percentages), both annual and monthly costs are shown, termination and refund provisions are clear, and the licensee's IDR and AFCA contact details are included.

Also check for automatic fee increases (such as CPI indexation). You should be notified of any fee changes. The agreement should specify communication methods and frequency.

Your Rights

You can: terminate at any time without penalty, request refunds of prepaid fees for services not provided, request client records at any time, and ask for a fee breakdown. You must receive annual fee disclosure statements and renewal notices.

If you do not renew, ongoing fees must stop. Your existing products remain in place but you will no longer receive ongoing advice or monitoring.

Reviewing Your Agreement Annually

Your Ongoing Service Agreement should be reviewed at least annually. When you receive your fee disclosure statement, compare the services provided against the services promised in the agreement. Were all agreed services delivered? If not, raise this with your adviser and seek a fee adjustment or a revised agreement that accurately reflects the services actually provided.

Your circumstances may have changed during the year, which may mean the current agreement no longer meets your needs. If your financial situation has become more complex, you may need additional services. If your situation has simplified, you may want to reduce the scope of ongoing services. Annual review is also the time to negotiate any fee changes and ensure the agreement continues to provide value for money.

Frequently Asked Questions

Can I negotiate fees?
Yes. Discuss your fee expectations before signing. You can ask for a structure that suits your needs, such as annual rather than quarterly payments.

What if I stop paying?
The adviser should cease ongoing services. Your existing products remain but you will not receive ongoing advice or reviews.

Can my adviser change fees?
They can propose changes but must notify you in advance. You can terminate if you do not agree. Changes cannot be applied retrospectively.

Do I need an ongoing agreement?
Required if your adviser charges ongoing fees. You can decline and pay only for the initial SOA if you prefer one-off advice.

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.