How to Choose a Financial Advisor

Maybe an inheritance has left you wondering what to do next, or a promotion or a successful business has given you more money to work with. That's welcome news, but with a family to look after and more decisions to make, you may feel ready for some help. A financial advisor could take some of that weight off your shoulders. The question is, where do you find someone you can trust?

A financial advisor might work for a brokerage firm, sell insurance, manage portfolios through a registered investment adviser, or combine several roles. Everyone seems committed to your future, and the language of trust appears everywhere; even their websites can look remarkably similar. So how can you tell which relationship will best serve your family, especially when one professional fills several roles?

The fact of the matter is that an advisor's compensation, obligations, and freedom to recommend alternatives will influence the advice you receive. Choosing well requires a clear view of what the professional is paid to do and how their interests could compete with yours.

Fiduciary Duty and Independent Judgment

Registered investment advisers owe fiduciary duties to their advisory clients. Brokers are subject to Regulation Best Interest when making covered securities recommendations to retail customers. Both frameworks impose obligations; they don't create identical relationships or make ongoing services interchangeable. Some professionals offer both brokerage and advisory accounts.^2,3

Others also sell insurance, which can serve needs such as income replacement or estate liquidity. When a recommendation involves a commission, understanding that compensation alongside the proposed benefits and alternatives helps a family evaluate the fit.¹

Additionally, and perhaps surprisingly, fiduciary duty doesn't erase every conflict. An advisor charging a percentage of managed assets has a financial incentive to retain those assets. A recommendation to keep money invested instead of paying off a mortgage therefore needs analysis of borrowing costs, liquidity, taxes, and risk. Therefore, fee-only advice can reduce sales conflicts while still requiring candor about other incentives.

Independence also involves ownership, product affiliations, and restrictions on available investments. These relationships can affect what a firm recommends and how it gets paid, including when a client keeps an existing investment or leaves an account elsewhere.

However, RIA registration alone doesn’t establish fee-only compensation or independence. A credible advisor should always explain the incentives involved, why a recommendation fits your circumstances, and the alternatives and risks considered.

What Advice Costs Today

So how much does financial advice cost, and how can you tell whether you're paying a fair price? First, we start with how the bill is calculated and what the relationship includes. The same annual cost could cover a detailed financial plan and ongoing support, or a much narrower investment service.

Fee-only payment structures describe advice paid for through client fees, including hourly charges, fixed fees, retainers, or asset-based fees. The distinction is the absence of sales-related compensation, which can include commissions, certain ongoing product fees, and referral compensation. Under CFP Board’s rules, the test applies to the professional and firm, and to related parties when that compensation is connected to services provided to clients.¹

Fee-based structures can combine client fees with commissions. Both terms describe compensation rather than the depth of planning provided, so similar-sounding proposals can represent different relationships.¹

For a sense of scale, a recent Kitces analysis reports an average hourly planning rate of approximately $300 and cites a $4,500 median annual subscription fee in its 2024 research. Hourly work charges for the time involved, a fixed project fee covers an agreed assignment, and a subscription generally provides continuing access to planning. These arrangements can involve different services, so their prices aren't directly interchangeable.¹⁰

For asset-based advice, Kitces' 2024 research, reported in June 2025, identified a median 1% fee for a $1 million client among advisors charging through assets under management alone. Its common fee range, covering the middle half of observations, was roughly 1%–1.2% below $1 million, with rates generally declining as portfolios grew. These are survey benchmarks, rather than a universal market average or a recommended price.⁴

At $1 million, 1% means $10,000 annually. At $3 million, the same percentage means $30,000. A growing portfolio can therefore increase the bill without a proportionate increase in planning work. Graduated fee schedules can soften that effect by charging lower rates on higher asset tiers; the blended rate across the entire portfolio shows the resulting cost.⁴

There is also an alignment of interests in asset-based pricing: when investment growth increases the value of managed assets, both the client's wealth and the advisor's fee revenue rise. When those assets decline in value, the asset-based fee generally falls too, subject to the billing terms. That gives the advisor a financial stake in the portfolio's long-term health. Naturally, it doesn't guarantee results or remove every conflict, since deposits and withdrawals also affect compensation, and a client's needs may call for spending or moving assets.

Where to Find a Financial Advisor

Fee-Only Network is a strong place to start for families who want fee-only advice. Its directory focuses the search on that compensation model, with options for local and virtual relationships. The site says listed advisors are verified as fee-only, fiduciary, and independent. That focus can remove much of the ambiguity found in a broad online search.⁵ Qualified advisors pay a flat annual fee for enhanced listings and profiles, and the directory does not rate advisors.⁶

Two other useful resources are NAPFA's Find an Advisor directory, which connects consumers with fee-only planners, and XY Planning Network's advisor search. XYPN's directory includes fee-only CFP® professionals and allows searches by specialty or niche, which can help a household find someone familiar with its particular circumstances.^7,8

Regulatory records help you verify an advisor’s registration, review reported disciplinary history, and examine the firm’s disclosed business practices. Investor.gov's search provides access to registration and disclosure information for firms and individuals. Form ADV brochures and, where applicable, Form CRS explain services, compensation, and conflicts.^3,9

In Conclusion

Confidence in an advisor develops when the relationship is easy to understand: how the firm is paid, what responsibilities it accepts, and how its work supports your family’s decisions. Fee-only advice offers a compelling starting point, especially when paired with independent judgment and substantial planning work.

At WealthGen Advisors, we believe our own approach belongs under the same scrutiny. A meeting gives your family an opportunity to examine how our fee-only planning model fits the decisions ahead, what support the engagement would include, and whether its cost makes sense for you.

Sources

1. CFP Board: Compensation Representations and Sales-Related Compensation
2. SEC: Regulation Best Interest and Investment Adviser Fiduciary Duty
3. Investor.gov: Brokerage and Advisory Relationships and Form CRS
4. Kitces Research: How Financial Advisors Charge for Their Services (June 16, 2025; 2024 Study)
5. Fee-Only Network: Directory and Verification Criteria
6. Fee-Only Network: Eligibility and Marketing Compensation Disclosures
7. NAPFA: Find an Advisor
8. XY Planning Network: Advisor Search and Eligibility
9. Investor.gov: Investment Advisers and Background Research
10. Kitces Research: Hourly Planning and Subscription Fee Benchmarks