The True Cost of a Financial Advisor, Revealed.

By finding the right financial advisor, you’re more likely to minimize risk, maximize gains and take advantage of tax breaks while investing for your future.

They can also help you protect your assets with the right kinds of insurance, and help you pass on your financial legacy with a proper estate plan.

The cost of hiring a financial advisor can vary significantly based on the services provided. Paying a 1% fee on your assets managed by a financial advisor is quite common, but there are at least seven ways financial advisors are compensated by clients, each with varying costs.

Financial Advisors Who Charge Based on Percentage of Assets Under Management (AUM)

The current industry standard is to charge anywhere from 0.50% – 2% of the assets being managed on an annual basis.

An indicator that your advisor is commission-based is if they offer a financial product, such as a mutual fund, that has a “front-loaded” fee structure.

Commission-Based Financial Advisors

Financial Advisors who Charge Subscription-Based Fees (Annual or Monthly)

These services can range from $50 per month to $500 per month (or more), depending on the level of support needed.

Instead of paying 1% of assets under management, clients instead pay 1% of their annual income for financial advice.

Financial Advisors who Charge Based on a Percentage of Your Income

Flat Fee Financial Advisors

A growing number of financial advisors offer services for a flat fee as an alternative to traditional pricing models (e.g. charging you 1% of the value of your portfolio managed by the advisor).

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