Identifying Your Financial Adviser

Choosing a financial planner is a very important step in a person’s life.  As people live longer, it is vital that we have some money put aside for our retirement years. Having money to get by from month to month, as well as some money put aside as our health starts to fail, should be a priority for us all.
Knowing how your financial planner gets paid may help you decide on the person you choose. All financial planners and advisers get paid in one of four possible ways:
Commission Only: These planners are paid by commission by selling financial service products. This can be in the form of investments, loans, or insurance products.
Commission and Fees: A financial consultant using this method receives a fee for developing your financial plan and make commissions off of the products they sell you.
Salary plus bonus: Used mainly by discount brokerage firms, these companies pay their workers a salary and then give them a bonus for signing on new clients.
Fee Only: These financial advisers are not registered representatives of a financial service company. They are typically self-employed. These advisers have no stake in the advice that they share with you. They recommend what they feel is best for you.
Typically, financial planners will use a combination of commissions and fees. The advisers may be working for a large brokerage firm or insurance company. Since the majority of their income comes from the sales of products that they recommend, it is important that you read through each product you wish to purchase and know exactly what you are entitled to and how much you are paying for the service.
If you have any questions about what type of financial adviser you should use, please contact the Kabb Law firm for more information at 216.991.KABB (9222).