Despite what their many critics might say, argues Peter Doherty, contingent fees can deliver the best outcome for clients and indeed, in the context of defined benefit transfers, non-contingent fees are a bad idea
There has of late been plenty of criticism directed towards advisers who charge contingent fees. This criticism is wholly misplaced, I believe - and in fact, for many transactions, it is non-contingent fee structures that are more likely to deliver worse outcomes for customers as a whole. What is more, it is easy to show that non-contingent fees generate a much higher total fee pool for advisers than contingent fees - and with no additional benefit to customers. The single most frequent - sometimes only - criticism of contingent charging is this creates an incentive structure whe...
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