As we’ve seen, with the recent CBA scandal, ‘free advice’ from a ‘trusted bank’ can turn out to be the most expensive advice ever received.
Financial advice provided by planners within CBA, has resulted in many ‘mum and dad’ investors losing their life savings and the bank both profiting from the scheme ( and in fact rewarding those that gave the ‘shoddy’ advice with promotions ).
The old saying applies – you get what you pay for…. free advice is more often benefitting the giver, rather than the receiver.
By paying an upfront fee, the adviser is not motivated by personal reward ( when giving advice on any investment question ) and there is a better chance that the advice given, has the investors best interests at heart.
As we have seen with many investments over time ( hawked around by advisers motivated by high commissions ) that when it sounds too good to be true – it just about always is.