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How much does having a financial adviser cost?

Firstly, you need to know how financial advisors get paid. It can vary but normally advisers are paid either through:

·         Charging/receiving a regular fee equal to a % of funds under management (FUM) (this might be comprised of commission and/or client fees).

·         Charging one-off fees for work. For example to provide a financial plan or set up an investment.

·         Charging hourly fees for work.

Having a financial adviser without having a large sum of money saved

It is commonly the case that financial advisers will require you to have a minimum amount saved to invest before they will work with you. This might be $50k, or even as high as $1m before they’ll consider working with you. At McKenzie Financial Planning (MCKFP) we‘re about removing barriers that prevent New Zealanders getting financial advice so we don’t have a minimum lump sum required to start working with us. Our aim is to help our clients grow their wealth and support them on their financial journey.

Can I afford to have a financial advisor?

Charging hourly rates and large one-off fees requires you to spend big up front diminishing your investment lump sum before it even has a chance to grow. At McKenzie Financial Planning (MCKFP) we much prefer being paid a small percent of funds under management (FUM) that means we're paid over a long period of time. This approach feels fair to us compared to the pay big upfront and thanks see ya later approach. We want to be with you on your financial journey. That's means long-term and forging a positive relationship at the start and carrying it forward into the future.


As starting point to bring you on board as a client we (MCKFP) would oversee your Kiwisaver. This would involve us recommending a Kiwisaver Provider/fund from those we use that is appropriate to you and act as your Financial Advisor for this investment. Depending on the Kiwisaver provider this might mean:

·         We're paid solely by the Kiwisaver Provider for joining you on (fully commission, paid as a FUM% fee),

·         It might mean we're paid through an advisor fee (again a % of FUM) that you agree to and your provider automatically deducts from your investment and pays to us (similar to how your fund provider charges fund management fees that are deducted from your account)

·         Or we can be paid through a combination of the above two approaches (part commission, part advisor fees).

Either way MCKFP advisors would receive a maximum of 0.5% of FUM p.a. paid monthly. To give you an idea of what looks like in real terms see the below table (below table is gross of tax).

Not a huge amount of money when you take into account also no hourly fees or one-off fees charged but Kiwisaver at its heart is meant to be low fee scheme and at MCKFP we’re onboard with this.

We'll act as financial advisor overseeing your kiwisaver and help if you have any queries about it. We'll also add you to our email contact list and be in contact 2-4 times a year with articles, prompts to keep your wealth growing, or blogs which will hopefully provide value to you. Your Kiwisaver provider will provide reports on your kiwisaver balance and performance at least annually based on their processes.

Other investments / managed funds

What about additional investments? Ideally you need more than just a Kiwisaver fund if you want to build real wealth. At MCKFP we use managed funds that operate similarly to Kiwisaver (relatively low fees, PIE funds) without the obvious drawback of Kiwisaver. (that you can't easily access the money invested - usually restricted to first home purchase or retirement age 65).

And best of all you don't need a huge lump sum or to make large regular payments to start investing with these managed funds. The funds we use have no minimum amount required for lump sums or regular payments. You can add any amount at any frequency.

You can also easily withdraw amounts (both lump sums or regular withdrawals) in just 5 working days (time required to sell underlying assets to free up cash).

These are excellent vehicles to grow your wealth; saving and investing excess cash where you can.

Do note that we (unlike Kiwisaver) charge a small one-off fee of $250 for preparation of the Statement of Advice document and facilitate setting up this managed fund investment. As with Kiwisaver we also act as financial advisor overseeing this investment so we are paid a percentage of FUM p.a. paid monthly. Like with Kiwisaver the maximum we would receive is 0.5% FUM p.a.

As your financial advisor for this managed fund investment, we would provide twice yearly reporting on the value and performance of your investment. This will be done either by email, zoom meeting, or in person (if your local) - it's up to you how we do this biannual reporting. When we meet, we’ll use this opportunity to discuss how things are going, and whether you have any other service needs from us i.e., insurance, general advice.


Hopefully the above makes it clear you can afford a (MCKFP) financial adviser and explains a little about how we’re renumerated for our services.

The above blog was written by Reid Mckenzie a financial adviser working for Mckenzie Financial Planning (

The above information is general in nature as is not meant to constitute personalised financial advice. Reid recommends seeking personalised financial advice from a registered financial adviser before making financial decisions.