Understanding fees for wealth management: Transparency that builds trust

Choosing a wealth manager is one of the most important financial decisions you can make. Whether you're growing a portfolio, preparing for retirement, managing an inheritance, or structuring your estate for future generations, the guidance you receive can have a lasting impact. But alongside the advice and investment strategy, one key factor often goes under-scrutinised: the cost.

Understanding what you’re paying and what you’re receiving in return is essential. Clear, transparent fees not only help you gauge value but also foster trust, ensuring you're in a relationship built on honesty and shared goals.

What do wealth management fees cover?

Wealth management is much more than just investment selection. A well-rounded service encompasses a wide array of financial disciplines, often working seamlessly together to protect and grow your wealth.

Here’s what your fees typically include:

• Investment management: Your portfolio is carefully constructed and actively managed to reflect your goals, time horizon, and risk tolerance. This includes asset allocation, rebalancing, fund selection, and ongoing monitoring.

• Financial planning: This is the strategic backbone of wealth management. Whether you’re planning for retirement, funding a child’s education, navigating divorce, or considering charitable giving, your adviser helps map out a clear path.

• Tax planning and estate strategy: Effective wealth management looks beyond returns and considers how to keep more of what you earn. Advisers help structure your finances to reduce income tax, capital gains tax, and inheritance tax while making sure your legacy is passed on smoothly and tax-efficiently.

• Regular reviews and advice: Life changes, and so should your financial plan. Regular meetings and portfolio reviews help you stay on track, adapt to changes, and remain confident in your long-term strategy.

These services are often delivered in an integrated manner meaning your adviser takes a holistic view, coordinating multiple elements to work together in harmony. The value of this cohesive approach is often greater than the sum of its parts.

Common wealth management fee structures

There are several ways wealth managers charge for their services. The key is not just knowing what the charges are, but understanding how they align with your goals and expectations.

1. Percentage based fees

This is the most common pricing model in the UK. The adviser charges a percentage of the assets they manage on your behalf typically ranging from 0.5% to 1% annually.

For example, if you have £1 million under management and the fee is 1%, you’d pay £10,000 per year.

• Pros: Aligns the adviser's incentive with your portfolio growth. As your wealth grows, so does their fee but they also have a vested interest in preserving and growing your capital.

• Cons: As portfolios increase in size, so can fees potentially outpacing the cost of the actual service delivered, unless additional value is provided.

2. Flat fees

Some wealth managers offer fixed-fee arrangements for financial planning, investment advice, or annual service packages.

• Pros: Predictable, transparent, and not influenced by portfolio fluctuations. Often appealing for clients who value clarity and prefer to separate advice from asset size.

• Cons: Flat fees can be perceived as expensive for smaller portfolios and may not scale well for more complex, ongoing needs unless tailored appropriately.

3. Tiered or blended fees

This model combines percentage-based charging with discounts as assets increase. For example:

• 1.5% on the first £250,000

• 1.25% on the next £250,000

• 1% on anything above £500,000

This approach acknowledges the economies of scale in managing larger portfolios while remaining aligned to performance.

4. Performance fees

These are tied to results usually a percentage of gains above a certain benchmark. More common in institutional or high-performance investment strategies, they are rare in mainstream wealth management.

• Pros: Directly incentivises the adviser to outperform.

• Cons: Can create a bias towards riskier strategies and may not reflect holistic planning work.

Why fee transparency is so important

Money matters are built on trust and trust begins with transparency. When it comes to fees, there should be no ambiguity. You should know exactly:

• What you’re paying

• How it’s calculated

• What services are included

• Whether there are any additional costs or third-party charges

Clear fee structures allow you to assess whether the service you’re receiving is providing fair value. They also encourage healthy dialogue between client and adviser, helping to align expectations and foster a genuine advisory partnership.

Importantly, fee transparency also reveals value over time. A good wealth manager should not only preserve and grow your wealth but help you make smarter financial decisions, avoid costly mistakes, and navigate complex life events with confidence.

The value behind the fee

While cost is important, it shouldn’t be viewed in isolation. A trusted adviser offers more than just portfolio management, they also offer peace of mind. From shielding you from poor decisions during market turbulence to guiding multi-generational wealth planning, the value of good advice often becomes most evident during life’s most challenging moments.

Moreover, when an adviser helps you save thousands in tax, avoid inheritance pitfalls, or exit a business efficiently, the long-term financial benefit can far outweigh the fees paid.

Curious about what you’re paying?

If you're unsure what your current wealth management fees include or whether you’re receiving value for money, it’s worth asking. An open, honest review could lead to better service, lower costs, or simply peace of mind that you're in the right hands.

Let’s have an open conversation.

At Oculus Wealth Management, we believe in clarity, integrity, and delivering real value at every stage of your financial journey. Our commitment is to full transparency so you know what you’re paying, why, and how it supports your goals.

Contact us today for a confidential, no-obligation review of your current arrangements. Let’s talk fees and see how we can help you move forward with clarity and confidence.