A fee-only financial advisor offers unbiased advice, transparency in costs and financial advice provided, and comprehensive financial planning.
A fee-only financial advisor serves as a fiduciary and must act in your best interest at all times. A fiduciary is required to disclose if and when there is a potential conflict of interest.
A commission-only or fee-based financial advisor is not required to serve as a fiduciary at all times. A fee-based advisor might recommend products or services to you in part because of the commission they might earn, rather than based on how well it fits into your investment strategy.
Transparency in costs and financial advice provided
A benefit of working with a fee-only financial advisor is having transparency and predictability in costs for advice provided.
A commission-only and fee-based financial advisor may may have additional conflicts of interest with incentives to buy and sell financial products that are not in your best interest. A complicated fee structure should serve as a red flag.
“Price is what you pay. Value is what you get.”
Beware of selecting a financial advisor only based on the lowest cost. There are high-cost and low-cost options for financial advice. While cost should be a consideration, it is essential to consider the value of the financial advice.
Comprehensive Financial Planning
A fee-only financial advisor can create a comprehensive financial plan focusing on financial planning, retirement planning, investments, Social Security optimization, tax planning, insurance planning, estate planning, and more.
Consider working with a CERTIFIED FINANCIAL PLANNER™ to find a credentialed financial advisor. Beware of a financial advisor that tries selling products without understanding your unique financial situation.
If you require a specific need or style of financial advice, for example a high-earning household preferring to limit taxes during high-income years, make sure your financial advisor can satisfy your needs and help reach financial goals.