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Senior Retirement Tips :: Fee Only Financial Advisor
Fee Only Financial Advisor: How Fee Only Financial Service Advisors Work
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A fee-only financial advisor runs their business on a model of advising not based on products and it’s very successful.
Why? Because financial advice isn’t tied to a product, however the advisor could still be getting a commission for any products recommended. As a result, customers are sometimes, though rarely, getting biased financial advice.
Consulting a professional financial advisor can be a great way to start your retirement savings or make them more efficient. Keep reading to learn why and how.
Why Is Fee-Based Financial Advising Important?
Certainly the title "fee only financial adviser" is a buzz term. Obviously, financial service organizations are responding to what they perceive as market demand for the qualities that a financial adviser brings to his or her client.
The market demand, which is present and growing, is rooted in the desire by a demographic segment of the population (that’s you!) to separate financial advice from financial products when planning their retirement or any of their financial goals.
Who is the Fee-Only Financial Advisor?
He or she is a duly licensed financial professional who promotes his or her financial and analytical skills and is paid a fee for the application of those skills to a client's situation.
The fee-based adviser also offers a client an analysis of their retirement savings or current financial position.
If the client accepts this offer and financial products are successfully acquired, the fee-based adviser often collects a commission for this work. Remember that.
Professional Characteristics
The fee-only financial adviser has a number of professional characteristics.
The first characteristic is the financial adviser's orientation. He or she has an absolute professional commitment to the client's financial well-being.
This means the adviser has no prior obligation that could take precedence over his or her client, such as that of being an agent for an insurance carrier or a registered representative for a broker/dealer.
This also means the adviser will strive for objectivity in dealing with his or her client, or at least they should if they’re upholding their title and license requirements.
The Fee Only Financial Advisor Approach
The fee-only financial advisor usually practices a comprehensive and integrated approach to providing financial recommendations.
They believe that all pertinent data about a client, personal and financial, should be taken into account when seeking to achieve a client's financial objective.
Regarding investments, a fee-only financial advisor or planner usually relies on an asset allocation model for making client recommendations.
The end result is usually a safe pictorial and worded investment portfolio that reflects the client's investment objectives, risk tolerance, and time frames. It’s easy to understand, simple to follow and put together with your best interests as the focus.
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