December 14th, 2019
December 14, 2019
Joseph Vecchio CPA, CFP, MBA

As you get older, busier and hopefully wealthier, your financial goals get more complicated.  A financial helper can save you time.

Like every service provider, a financial advisor is paid for doing their job.  However, they don’t all get paid the same way.  A fee-only advisor is paid directly by the client on a transparent and pre-arranged payment plan.  This can be an hourly or project rate, monthly retainer, or percentage of investments managed.

Fee-only financial planners are registered investment advisors with a fiduciary responsibility to act in their clients’ best interest.  As a potential client, you should be concerned whether or not an advisor is recommending a certain product because it helps their bottom line more than it helps yours.  In fact, there are some registered reps that are given additional compensation for selling certain products offered by their employer.

Fee-only advisors offer an objective view and generally more comprehensive advice.  Services can be tailored to addressing a specific financial question to a review of your entire investment portfolio.  Fees are provided up front and are not based on product sales, allowing a fee-only advisor more time to focus on advice than what product to sell.

The professional organization for fee-only advisors, the National Association of Personal Financial Advisors (NAPFA) requires members to adhere to a higher set of standards.

  • Meet stiff ethical, credentialing and educational requirements.
  • Be primarily engaged as a holistic financial advisor (rather than merely an investment or tax advisor).
  • Meet the most rigorous continuing education requirements in the industry.
  • Submit to outside professional review, to ensure there are no conflicts of interest created by commissions.
  • Submit a financial plan for review by peers, before being admitted as a member.

There are other advisors that are not considered fee-only.  They are paid through other sources including by the companies they recommend.  For example, if the planner sells you a specific investment, mutual fund, insurance or other products, they receive a commission or partial commission from the company.  This situation does not always work in your best interest and you may want to avoid a salesperson that could be out for personal gain.

Ultimately, you want to choose a fee-only planner who will be loyal to you and your interests.

Shore Financial is a fee-only, tax-focused financial planning firm located in Monmouth Beach, NJ.

Joseph Vecchio CPA, CFP®, MBA is the firm’s President and has dedicated his professional life to the finance and accounting professions.

Joe believes that people are being exploited by financial salespeople who are merely motivated by quotas, product sales and commission-based income! Shore Financial Planning was founded to provide peace of mind through conflict-free, value-added advice.