• Deborah Nason

WHAT PEOPLE DON'T KNOW #2. Part I

HOW THEY'RE PAID:

There are three main modes of compensation for advisors: • Commission-only: Financial commissions are paid by mutual funds, insurance companies, and brokerages to the registered representatives who sell their products. • Fee-only: Fee-only advisors are paid directly and only by their clients. They receive no commissions and aren't paid via marketing dollars. Their fees can be hourly, a retainer or a percentage of assets under management. • Fee-based: This hybrid approach allows advisors to choose how they get paid. They can charge fees or a percentage of assets under management for some of the funds they manage, but also accept commissions for other products such as insurance policies.