Designed with the utmost Purpose

Fee Only Adviser

A fee-only financial advisor is compensated solely through the fees they charge their clients for their services. These fees may be based on a flat rate, an hourly rate, or a percentage of the assets under management (AUM). Since a fee-only advisor does not earn commissions or other incentives from selling financial products, their compensation is not tied to specific products or transactions.

This model helps to reduce conflicts of interest, as the advisor’s primary motivation is to provide advice that best serves the client’s needs, rather than recommending products that generate a commission. The fee-only structure is often seen as a more transparent and client-focused approach, as the advisor’s interests are more closely aligned with those of the client.

Broker Who Accepts Commissions

A broker (often referred to as a “salesperson”) typically earns commissions based on the financial products they trade or sell, such as mutual funds, stocks and bonds.

Because brokers receive commissions, they may have an incentive to recommend certain products over others based on the potential for a higher commission, even if those products are not the most suitable or cost-effective for the client. This compensation model can create a conflict of interest, as the broker may be motivated to recommend products that benefit them financially, rather than focusing solely on what is in the client’s best interest.

Summary of Differences