What exactly is a “fee-only” financial planner?
The majority of financial planners get most of their income in the form of commissions for selling you mutual funds. However, a small group of planners have opted for the “fee-only” payment model, in which they get 100% of their income from their clients, and no money from mutual fund companies. The main benefit of hiring a fee-only planner is that you know your planner won’t have any conflicts of interest. For instance, your planner would have no reason to recommend life insurance if you didn’t need it, since he or she wouldn’t get a commission for selling it to you. It’s also easier to keep track of what you’re paying your planner. Most of our clients were shocked when they found out the amount of money they were paying their old financial planners in fees that were embedded within the mutual funds that they were sold. We are saving many of our clients thousands of dollars per year in fees.
Related Questions
- I understand the benefits of working with an Hourly, Fee-Only financial planner, but I might need to obtain financial products. How will I be able to do that?
- I understand the benefits of working with a Fee-Only financial planner, but I might need to obtain financial products?
- Whats the difference between a fee-only, fee-based, and commission-based financial planner?
