International Independent Financial Advisers are normally paid on the commissions and fees they generate when they bring on new clients. This is normally from the investment products they recommend to their clients. Products like Pension plans, savings plans, portfolio bonds, and life assurance.
In almost all of the cases, it will cost the client the same, in regard charges, if they were to go direct to an Investment product provider like Generali, or through an Independent Adviser. So unless you are very knowledgeable its always best to seek the advice of a professional, as it will normally not cost the client anything extra.
Fees and Commissions range from 4% to 8% of the amounts invested, or if a company charges hourly fees instead of working from commissions, these range between £250 to £650 per hour depending on the experience level of the adviser.
The share of the fees and commissions you receive will depend on your experience level.
For example, a Trainee adviser will normally receive around 40% of the commissions and fees generated. This is because the company has to spend more time with training and supervision, as all advice must be checked and signed off by an experienced consultant.
So as your experience grows so will your income, with the most experienced and successful advisers earning as much as 90% of the commission generated.
Some employers also have a performance scale. This means that the more commissions you make the larger percentage you will receive. This will be designed to encourage a higher performance.
Ultimately, how much you earn will depend on how hard you work!!
There is no secret to success for financial advisers, almost all have the same knowledge and the same products to sell. But they don’t all make the same amounts of money and that is for a variety of reasons.
The first and most important reason is that the IFAs who make the most money, almost always are seeing more prospects than their peers. Its quite simple the more potential clients you meet, the more people will become your clients, and the higher your income will be.
At the start of your career, you will spend 80% of your time focused on finding and meeting prospects. As you build the size of your client bank over the years this will change, as you start to pick up referrals from your clients and build your reputation, you will eventually be spending 10% finding new prospects and 90% looking after your clients.
Other factors!
As an IFA you are paid a commission based on the size of the client’s investments. What this means is that you have a limited amount of time in the day if you spend your time prospecting clients who earn lower incomes, their investments will be lower, and as a result, your income will be lower. But it takes the same amount of effort and time to take on a client who invests $200 per month as it does to take one on who invests $2,000 per month.
So you need to aim for quality prospects, people who are further into their careers than those just starting out. The more clients you can find with higher free monthly incomes and savings the more money you will make for doing the same work.
Work smart and hard. Use your common sense, target professionals and those with high monthly incomes and lower costs. For example, most expatriates earn higher salaries while they work abroad and most of the time this is tax-free.
Looking the part!
IFA’s who take pride in how they look will have more success than their peers. For men, this should be dark suits, black shoes, double cuff shirts. Whether you wear a tie or a jacket will depend on where you work.
See what the local business people are wearing and match that. For example, as an IFA in London dark suits with double cuff shirts is expected. But in the Caribbean, you are not expected to wear a suit jacket.
Have quality tools. If you are starting out maybe you can’t afford nice pens and expensive leather cases, that’s okay. Use simple biros and carry a folder, don’t be tempted to bluff it. Your client doesn’t want to see someone wearing a fake Rolex, if you can’t afford a nice watch just don’t wear one. If you can’t afford a Mont Blanc pen, don’t worry a $5 biro is fine. But when you make good commissions, start to acquire quality tools.
You have one chance to make an impression as normally you will meet a potential client at their office or a local café. So you need to look and act the part, but be honest in your approach, don’t try to be something you are not, the client will see through that.
We cover these important tips and methods on our courses, we have learned over thousands of client meetings what works and what doesn’t. This knowledge helps our graduates earn much more than peers with similar levels of experience.
Average earnings!
Well, it would be expected at most brokerages that each consultant earns in excess of $100,000 per annum, some earn $40k to $70k but are happy with that, while others earn millions. Put it this way to earn $100,000 in commissions you will need about 15 to 20 new clients in the year. That’s less than 2 new clients a month. Anyone with the right knowledge and hard work can find two new clients a month.
As a graduate of our IFA training and assuming you work hard every day, stay focused on your goals, keep your clients best interest at heart you simply cannot fail.
