Academy

How much should you be charging for your Lifestyle Financial Planning service?

How much should you be charging for your Lifestyle Financial Planning service?

This is a common question.  In fact, one of the most common conversations I hear amongst Lifestyle Financial Planners is about how much to charge.  And the answer is, it actually doesn’t matter how much you charge.  Let me explain.

If you’re struggling to onboard a client, it’s not because of your fees

Questioning what to charge is almost an obsession – particularly amongst those who are maybe struggling to get clients engaged.  They start to believe that the problem is what they are charging, or the structure of their fees.  Let me reassure you – it isn’t.

It may be because you are struggling to get the client fully engaged in great Lifestyle Financial Planning – you’re struggling to get them excited and energised.  Or maybe you don’t have a great process for onboarding them and showing them the roadmap through this process that will lead them to a great tangible outcome.  But it’s not because of your fees.

So, what should you charge?  Let’s refresh our memories for a moment.

Remember, you are offering 3 elements to your service

There are 3 elements to our service, as Lifestyle Financial Planners:

  1. Life Coaching.  This is about working out the big, human questions – the ‘for what?
  2. Financial Advice.  This is about the products. What products should be chosen, switched, contributed to?
  3. Financial Planning.  This is about cashflow modelling.  Do we have enough to satisfy the requirements of what we’ve established we want (in human terms) during our life coaching session, and what framework do we need to apply the products to satisfy the financial plan?

It’s important to remember that each of the 3 elements has a value.

Each element has a value

When I first started out, I was a traditional financial advisor.  I arranged products for people – my pitch was either that my products were better, or cost less.  And the charges were all built into the products.

Over time, I fell into financial planning and cashflow modelling because I began to see that I had to understand the context into which these products needed to fit.  What purpose did they need to support?  Cashflow modelling became more important and I grew into the financial planning aspect.

Slowly, over time, I started to question what the planning was for.  So I began doing some coaching with the clients to understand what the big human questions were that we were trying to answer – the ‘for what?’

But what I didn’t do, was start explicitly charging for these services.

To the client, I was just a financial advisor who did some other stuff.  But in my head, I was a fully fledged Lifestyle Financial Planner, delivering a fantastic process. I understood that the main value was in the life coaching element.  However, my pricing was all tied into the products.  The effect?  My clients believed the value was all in the products and they didn’t see the value in the other elements.  So I learnt to separate each element and charge for each one.

Separate the 3 elements and set a fee for each

It’s really important to clearly define each of the 3 elements and set a specific fee for each.  It forces you to demonstrate and explain to the client the enormous value of life coaching – rather than disguising it within the financial advice element.

There are many different structures for how you charge, or for how you deliver your service.  You may simply offer the life coaching element, and subcontract the financial planning and financial advice work.  Or, you might offer all 3 elements yourself.  It doesn’t matter, as long as the client is getting all 3 as part of their Lifestyle Financial Planning process.

What does matter is that what you are charging for each element is explicit.

It doesn’t matter what you charge, just charge something

After a while, I learnt this.  Initially, I worried about charging for each element – I even came up with a whole range of different ways to do it.  In the end, I went straight in with confidence and decided I would explain the value of each and charge £500.  At my next client meeting, I gave a great performance – delivering a fantastic site survey – and when it came to explaining all of the benefits, I bottled and said, “£50

But it didn’t matter – what mattered was that they were paying me something, specifically for the life coaching element.  It confirmed that they had seen the value in it.  And because I had managed to convey the value, it reinforced my perception of the value.

Over the years, my pricing structure has changed and adapted and my fees have increased.

The point is, it doesn’t matter what you charge for your coaching and planning work – as long as it’s something

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