Godfrey Pembroke adopts fee-for-service model
MLC-owned financial planning dealer group Godfrey Pembroke has announced it will move to a pure fee-for-service model for all of its new clients from October 1, 2006.
Godfrey Pembroke managing director Mark Rantall said the initiative, which was driven by the firm’s 170 advisers, is all about transparency and control for clients.
“It’s about transparency, because the client has a right to know how much they’ve paid, who they are paying it to, and what they are getting for what they pay,” he explained.
“It’s about control, because it’s about the client being able to have a relationship with an adviser, agree what the terms of engagement are, and be able to control the fees that they pay,” Rantall added.
Once the model is in place all Godfrey Pembroke advisers will have to either dial down or rebate any commissions associated with the products in which the client is investing, and replace them with a fee-for-service negotiated directly with the customer.
“The fee will be expressed as a dollar amount on the statement, but it can be negotiated as a percentage of funds under advice, a flat dollar amount, or whatever the adviser and client agree is relevant for their set of circumstances,” Rantall said.
Godfrey Pembroke’s new direction marks the second step taken by the MLC group to encourage a fee-for-service financial planning environment.
In March, the group launched a platform product containing zero commissions called MasterKey Fundamentals.
“Across our whole advisory network we’re helping our advisers transition to a fee model.
“We’re providing product that accommodates a fee model, and we’re providing business support that helps our advisers move to a fee model,” MLC chief executive Steve Tucker said.
Recommended for you
Money Management examines the share price of financial advice licensees over one year to 31 March, with M&A actions in the final quarter having a positive effect for two licensees.
A $3.5 million settlement for victims of Melissa Caddick has been approved by the Federal Court following an initial agreement last December.
The Reserve Bank of Australia has delivered its first rate decision since the introduction of a new board structure last month.
Digital advice provider Otivo has launched an interactive tool, powered by artificial intelligence and Otivo’s own advice engine, to help answer client questions.
