{"id":8702,"date":"2017-10-02T09:18:22","date_gmt":"2017-10-02T16:18:22","guid":{"rendered":"http:\/\/blog.paladinregistry.com\/?p=8702"},"modified":"2017-10-02T09:18:22","modified_gmt":"2017-10-02T16:18:22","slug":"top-financial-advisors-dont-collect-commissions","status":"publish","type":"post","link":"https:\/\/www.paladinregistry.com\/blog\/advisors\/top-financial-advisors-dont-collect-commissions\/","title":{"rendered":"Top Financial Advisors Don\u2019t Collect Commissions"},"content":{"rendered":"

In previous articles I\u2019ve written, I\u2019ve gone over the question to ask when hiring a true financial professional<\/a><\/span><\/strong> (aka a fiduciary), the way to find out if your current financial advisor is for \u201creal\u201d<\/span><\/strong><\/a>, and a common theme in both these articles is that so-called financial \u201cadvisors\u201d should eliminate conflicts of interest by not accepting commissions for selling certain products.\u00a0 Otherwise, they aren\u2019t\u00a0top financial advisors; they\u2019re just salespeople.\u00a0 Granted some of them may not know any better when first entering this industry, but \u2013 once they\u2019ve been in the industry for a few years \u2013 they should realize that pushing investment products isn\u2019t always in their clients\u2019 best interests.<\/p>\n

Commissions can cloud the advice given by a financial advisor to his\/her clients, so this is a potential conflict of interest.\u00a0 How can you trust that the advisor\u2019s investment recommendation is truly best for your situation (a fiduciary MUST put your interests first with all financial advice given), or is it just putting more money in your advisor\u2019s pocket?\u00a0 Eliminating commissions is just the right thing for financial advisors to do if they want to be taken seriously; otherwise, there will always be a tinge of distrust with that \u201cadvisor\u2019s\u201d suggestions.\u00a0 It is much better if your true financial professional gets paid via a fee (usually a %) for managing your investments, a retainer, and\/or an hourly fee for the work he\/she does for you.\u00a0 It can help reduce and \u2013 in some instances \u2013 eliminate these conflicts of interest.<\/p>\n

RIA firms with fiduciary advisors who do not get paid via commissions are going to be the first place to shop for your true financial advisor (unless you\u2019re a do-it-yourself financial guru, but be careful<\/span><\/strong><\/a> \u2013 a vast amount of topics to understand); that should save you some search time.\u00a0 These professionals will start with the basics and take the time to make sure you\u2019re on the right path (budget<\/a><\/span><\/strong>, risk assessment<\/a><\/span><\/strong>, and financial plan<\/a><\/span><\/strong>, anyone?) before suggesting the next steps needed (don\u2019t put the cart before the horse).\u00a0 Commission-based advisors are almost always under pressure to sell, so often they aren\u2019t going to take the time to do what\u2019s right for you (they must hit their numbers AND keep their firm happy).<\/p>\n

A recent article<\/a><\/span><\/strong> from the magazine Financial Planning <\/em>cited a study showing that almost none of the largest RIAs (measured by assets under management – (AUM)) receive commissions as part of their regular business models.\u00a0 If the top RIA firms are shying away from commission-based business altogether, smaller RIA firms should do the same (we don\u2019t accept commissions either).\u00a0 Makes you wonder why brokerage firms often still work on this outdated model, and why you\u2019re still working with the advisor that gets paid via commissions?\u00a0 Wonder no more \u2013 now that you know better, hire a fiduciary as your financial advisor\u2026you\u2019re welcome!<\/p>\n

Find an experienced financial advisor who helps clients achieve their goals, works for an RIA firm, earns his\/her money from fees (NOT commissions), believes in having an abundance of investment choices for clients, and has the heart & demeanor of a teacher, NOT a salesperson, and chances are you\u2019ve found the right financial advisor to help you prepare and plan for your goals.<\/p>\n

To learn more about Martin Federici at\u00a0MF Advisers Inc.<\/a><\/span>, view his\u00a0Paladin Registry research report<\/a>.\u00a0<\/span><\/strong><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

In previous articles I\u2019ve written, I\u2019ve gone over the question to ask when hiring a true financial professional (aka a fiduciary), the way to find out if your current financial advisor is for \u201creal\u201d, and a common theme in both these articles is that so-called financial \u201cadvisors\u201d should eliminate conflicts of interest by not accepting commissions for selling certain products.\u00a0 Otherwise, they aren\u2019t\u00a0top financial advisors; they\u2019re just salespeople.\u00a0 Granted some<\/p>\n","protected":false},"author":12,"featured_media":8710,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[325],"tags":[],"class_list":["post-8702","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-advisors"],"yoast_head":"\nTop Financial Advisors Don\u2019t Collect Commissions<\/title>\n<meta name=\"description\" content=\"Top financial advisors 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