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Fee Only Vs. Fee Based

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SFM was founded on the principal of aligning the interests of the advisor with the interest of the client. Operating as a fee-only financial advisor allows us to do just that. The only source of revenue that we receive is from our clients. We do not and cannot accept any type of compensation from mutual fund companies, insurance companies, third party research firms, or broker dealers. This allows us to focus on the best investment for our clients and to ignore the investment that puts the largest commission in our pocket.

Conversely, commission-based advisors are paid based on the type of product that they sell and the amount of transactions that occur in the accounts they manage. This fee structure can incent a commission-only advisor to invest client money in an unsuitable fund and can also prompt them to make an excessive amount of trades in a client's account in order to generate extra commissions (this is called "churning"). We believe that the structure of this type of relationship is flawed and unfavorable for the client. It is very important to understanding how your advisor is paid and what his/her incentives are.

Don't just take our word for it. Search online to see what others believe is the best type of advisor-client relationship.