Fee-Only Planners

Understanding the fees involved with hiring a good financial planner will help you to become more comfortable with the person you are dealing with, especially when your financial advisor understands your needs.

What’s the cost of the help? There are three basic billing structures that many financial planners are getting paid through:

1. Fee-only structure: This form refers to those planners who get fees only for the advice they give. No commissions are available here.

2. Fee-based structure: Here, planners get paid for advice and they make commissions by selling some financial products.

3. Commission-based structure: Planners depend on earning money from the products they sell.

What’s the best structure that suits your financial needs? According to our bad financial situation, the first type of billing structures is the best choice for us. Why is that?

Simply put, you need to feel confident that your financial planner won’t make recommendations to generate fees. Also, you don’t have to be worry because of the high fees you may face on the other types. You will know exactly how much it will cost you to take advice from fee-only planners.

How much does it cost you to hire a fee-only planner? There are some different systems in how fee-only planners bill clients. Let’s get more information about that topic and choose what suits our needs!

1) Some fee-only planners charge you a percentage of a client’s assets, about 1-2 percent. Those planners have great incentive for you to make a lot of money. In this case, you may spend typically about $1,600 per year.

2) Some may charge flat rates or an annual retainer. If you want to lower the cost of the help, that category will meet your needs as the average cost is about $500 per year or so.

3) And others may bill by the hour. These days, planners’ hourly rates average $120.

Before hiring a financial planner, estimate how much you can afford to pay his fees. After that, choose the best category of paying systems.

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