What is a fee-based financial planner?

A fee-based financial planner is often both a registered investment advisor and a broker-dealer. This means they earn their living through a combination of sales commissions and one of the fee structures described above. Commissions can come from activities such as selling annuities, permanent life insurance or proprietary mutual funds.

What is a fee-based financial advisor?

A fee-based financial advisor is not paid in the same way as a fee-only advisor. While a fee-based financial advisor also charges fees to their clients, they can also generate additional income through commission on the financial products they recommend. They may also charge a performance-based fee.

What is a fee based service?

A fee-based service is usually offered by a financial advisor who charges an annual percentage of the client's assets as a flat fee for all or most professional services. The average fee is 1% to 3% of the assets. This isn't the same as a fee-based investment which is a product that may pay a commission to the advisor for selling it to clients.