Fee-Only, Fee-Based, or Commission — What’s Really Going On

“Fee-based” usually means an advisor charges an ongoing fee tied to managed assets, but can also maintain licenses to earn commissions from selling insurance or financial products.

“Commission” means an advisor is paid each time they sell a financial product or complete a transaction.

“Fee-only” advisors — like us — are paid directly and solely by the client. We do not sell insurance products, accept commissions, or collect third-party payments of any kind.

Many firms in our area operate under a fee-based or commission model, mixing fees with product sales.

There’s no single model that fits every investor in the marketplace, but we believe transparency and clean alignment are what matter most.

Here’s how our Fee-Only model works: we charge a transparent percentage on the assets we manage for you, or a flat fee for comprehensive financial planning.

When your account goes up, our fee goes up — because your wealth has grown. When your account goes down, our fee goes down — because your portfolio dipped.

That said, I always like to be upfront: the fee is still charged regardless of market behavior. Some people think there are firms that only charge if the portfolio grows every single month. No financial firm can operate with zero revenue during market downturns, so when you hear marketing slogans along those lines, take them with a grain of salt.

The goal isn’t to find the cheapest setup — it’s to find a relationship where your advisor’s compensation is cleanly aligned with your growth, with zero side commissions getting in the way.

That’s how we believe financial advice should be.