You will pay fees for having your wealth managed depending on the level of service you would like. Be sure you find an advisor who provides you with the different pricing options you might want to consider.
Fee for planning. In this type of arrangement, you pay your advisor a fee once per year to review your portfolio and make any suggestions and recommendations. You get a second set of eyes to look things over and make sure you aren’t missing anything. Depending on the complexity of your situation, this fee will likely range anywhere from $99-$10,000.
Investment Management. This style of management is appropriate for people who don’t want to do all of the buying and selling required with investments. They are looking for a money manager who will watch their accounts daily and make adjustments as needed. Many of the people I meet with in retirement feel this assistance is prudent to have since they are no longer contributing to their retirement assets. They want an extra level of oversight to make sure their investment accounts are being optimized. You should expect to pay anywhere from 0.5 to 2 percent annually depending on the size and complexity of your accounts. Sometimes a fee-based management firm will accept commissions as a part of its compensation. This situation can be okay as long as it is disclosed upfront. In my experience, mixing fees and commissions on products has been one way to reduce the overall cost to you.
Commission only. In this scenario, the planner works on commission only. I’d stay away from this type of relationship. Not because the planner is a bad person, but because it creates a conflict of interest for you that may not serve you the best. If the advisor only gets paid for selling you something, you may end up with a wonderful experience when you first start, but overtime, you may begin to feel that the advisor just doesn’t have time for you. If the advisor only gets paid when he or she sells you a product, then you will always wonder, “Is this really the best for me or is it the best for my advisor?” Stay away from working with people who are commission-only salespeople.
I have a small firm that offers a very high level of service, and I intend to keep it that way. I would much rather do a very good job for a small group of people than a mediocre job for a large group of people.