Welcome to our blog, the place we get things off our chest. It's a mix of rants and raves, often about fees and the cost of financial advice, along with anything else we think you might find useful.

Fair's Fare

By Ian Millward, published 19 April 2021.

Does being fair in business come at a cost?

A few weeks ago, I was encouraged to take some legal advice on a piece of land behind my house. One solicitor’s letter later and I was presented with a bill for over £4,000. I can’t really complain as the hourly rate and time involved were both clearly set out beforehand. But having read the letter, and witnessed the outcome, the whole thing left me feeling a little … hollow.

It felt transactional and had I known what the outcome of the work would be, I might not have bothered. It also left me wary of asking for more advice for fear of another hefty bill.

When Justin and I set up Candid Financial Advice this was exactly the kind of feeling we wanted to avoid for our clients. It wasn’t a commercial decision to be deliberately ‘disruptive’, simply a choice about how we wanted to do things.

That comes across in numerous ways but is perhaps best illustrated by our approach to charges. We do the exploratory work at our risk and cost and when someone does become a client, we charge an all-inclusive fee that is overtly fair. The initial fee is kept deliberately low, we never charge for top-ups (unless a significant new piece of work) and the annual fee bands fall at clearly demarked levels that we publish on our website.

From our perspective, the biggest leap of faith is the commitment to do the exploratory work at our risk and cost. It is not an empty gesture, and we don’t limit our time or hold back pieces of the jigsaw. We do whatever it takes and typically spend anything between 8 and 12 hours on a new enquiry (and sometimes nearer 20) just helping people work out what is right for them. We never pressure anyone to become a client and it only happens if, and when, it is right.

They say things come in threes and the arrival of my solicitor’s bill coincided with two other events that got me thinking.

The following day one of the guys here was telling me about an IFA firm a friend of his worked at who had just earned over £100,000 from one client. Even being kind on the hours involved this was flagrant opportunism.

And the day after that we had a potential new client who willingly took over 20 hours of freely given time, research and help but, it transpired, with the intention of finding out whatever they could for free. And that was what bothered me. If he just wanted a sounding board and some guidance, we would have willingly provided it, but this was a slightly more cynical case.

I won’t say more than that, except that this blog did start life as a way of getting things off my chest. However, I tend to be a glass two thirds full kind of person and allowing the dust to settle has helped me see things in a better light.

Does our approach to charging change the way people behave?

Yes, it does. But that is what we want and exactly why we do it. In the same way my solicitor’s approach encourages me to do a lot of thinking before I speak with him, and to minimise contact, our approach encourages people to take their time, talk with us and explore their concerns. And through that we build better relationships and help people make better decisions.

Is it occasionally abused? Yes, it is. You would expect that. But the remarkable thing is not that it happens but how rare it is and how well the overwhelming majority of people respond to it.

When we made that commitment, all those years ago, we didn’t know it would work. It was just what we felt was right. But people respond and reward trust and goodwill with …trust and goodwill. As a result, we enjoy unusually good relationships with our clients and that makes our business more efficient and a better, more enjoyable place to work.

So does being a fair business come at a cost. Yes, it does, and it is worth every penny.