The Financial Conduct Authority told advisers it does not expect them to be "charities" but cautions firms to avoid conflicts of interest when charging decumulation clients on a percentage basis.
Speaking at the Personal Finance Society's annual conference, the regulator's head of life insurance and financial advice supervision Debbie Gupta said advisers charges should be fair, the FT Adviser reports.
She said: "Everyone should be paid a fair amount for the services that they provide - but we do expect you to consider the conflicts that will arise, including how you structure your charges to ensure this does not lead to consumers suffering harm.
So how does your charging structure work and is it future-proofed against that evolving market?"
"Take for example the charges on ongoing advice. Most advisers that we see are charging a percentage of the client's assets and this structure works well for clients who are building their wealth.
"Is it the right structure for people who are withdrawing their assets? Each withdrawal reduces the level of fee you receive and over time that fee income can drop significantly."
Gupta added: "At the same time, client circumstances may be getting more complex - as they age they become more vulnerable, they may be less able to visit you in your offices and they may need more care from you.
"We would be really concerned if long standing clients were priced out of advice just at the point when they need you the most.
"After all helping people make decisions on withdrawing assets for use in retirement is as essential as advising on how to invest those assets.
"So how does your charging structure work and is it future-proofed against that evolving market?"
Gupta also highlighted that issues remain in the defined benefit transfer advice market as firms fail to take on board the regulator's guidance.
She said many cases were still arising with uncertain income levels for clients or where blended solutions had not been considered.