Fee Models and RIA vs Broker-Dealer

AUM fees typically range from 0.25% to 1.25% of the portfolio annually Flat-fee or retainer models charge a fixed amount regardless of portfolio size Commission-based pay creates potential conflicts since advisors earn more by selling products Independent RIAs are not affiliated with product manufacturers, reducing conflicts

Credentials Worth Knowing

CFP requires coursework, a rigorous exam, experience, and ethics standards CFA focuses on investment analysis and is common among portfolio managers CPA/PFS combines accounting expertise with personal financial planning Research the requirements behind any designation before being impressed by letters

Questions to Ask a Prospective Advisor

Are you a fiduciary at all times, and will you put that in writing? How are you compensated — commissions, referral fees, or revenue sharing? What is your investment philosophy and how do you construct portfolios? What types of clients do you typically work with and what services are included?

Red Flags to Watch For

Guaranteeing specific returns or downplaying risk is a serious warning sign Reluctance to clearly explain fees or compensation structure suggests misalignment Pressure to make quick decisions or move assets before you have done research Recommending complex products without clear justification for your situation

Checking Regulatory History

FINRA BrokerCheck shows complaints, disclosures, and employment history for brokers The SEC's IAPD provides registration details and Form ADV for RIAs Review the advisor's Form ADV Part 2 for fees, conflicts, and disciplinary history State securities regulators may have additional records worth checking

Choosing a Financial Advisor

Curated by: Rubric Advisors

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Fiduciary vs Suitability Standard

A fiduciary must act in your best interest and disclose all conflicts of interest
The suitability standard only requires that a recommendation be appropriate, not optimal
Registered Investment Advisors are held to the fiduciary standard by law
Broker-dealer reps follow Regulation Best Interest, stronger than suitability but not full fiduciary

When You May or May Not Need an Advisor

Complex situations like business ownership, stock options, or estate planning benefit from guidance
Straightforward savers may do well with low-cost index funds and self-directed accounts
Major life transitions like retirement, inheritance, or divorce justify advisory fees
Behavioral coaching during market volatility is one of an advisor's greatest contributions

Our Approach Retirement Planning

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Fiduciary vs Suitability Standard

Fee Models and RIA vs Broker-Dealer

Credentials Worth Knowing

Questions to Ask a Prospective Advisor

Red Flags to Watch For

Checking Regulatory History

When You May or May Not Need an Advisor

Related Topics

Robo-Advisors vs. Human Advisors: Which Is Right for You?

Do Tech Employees Need a Financial Advisor?

ABLE Accounts: Tax-Advantaged Savings for Disabilities

Fiduciary vs Suitability Standard

Fee Models and RIA vs Broker-Dealer

Credentials Worth Knowing

Questions to Ask a Prospective Advisor

Red Flags to Watch For

Checking Regulatory History

When You May or May Not Need an Advisor

Related Topics

Robo-Advisors vs. Human Advisors: Which Is Right for You?

Do Tech Employees Need a Financial Advisor?

ABLE Accounts: Tax-Advantaged Savings for Disabilities