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Glossary > Finance > Financial Advisory > Financial Planning
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Fee-only Planner

A fee-only planner is a financial advisor who only charges clients fees for their services and does not earn commissions from selling financial products like insurance or investment funds.

Example #1

For example, a fee-only planner may charge an hourly rate or a flat fee for creating a financial plan tailored to a client's needs.

Example #2

Another example is a fee-only planner who charges a retainer fee for ongoing financial advisory services regardless of the products recommended.

Misuse

Misuse of fee-only planning could occur if a planner claims to be fee-only but also earns commissions from selling financial products without disclosing this conflict of interest. This is important to protect against as it may lead to biased recommendations that prioritize earning commissions over the client's best interests.

Benefits

The benefit of working with a fee-only planner is that they are incentivized to provide advice solely based on your financial goals and not on earning commissions. This setup aligns their interests with yours and helps avoid potential conflicts of interest.

Conclusion

Choosing a fee-only planner can provide you with unbiased financial advice tailored to your specific needs without the influence of commissions from product sales. It enhances transparency and ensures that the planner is acting in your best interests.

Related Terms

Financial AdvisorFinancial Planning

Last Modified: 4/30/2024
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