Fee Only Advisor
What clients have said about Jim
The time and money we spent with Jim was very well spent. We have given several people a referral to Jim because his services have been excellent, his advice has saved us money, and we will be much better prepared for retirement due to his expertise. I’m all sold on Jim! He was exactly what we were looking for, and gave us more than we expected.
Micheal and Faith Watson
Jim’s ‘fee only’ service should actually be called ‘peace of mind’ service. There is no fee or price that can be put on peace of mind and that is what I received after meeting with Jim. He is very astute and spoke to me in terms I understand. After reviewing my specific financial circumstances he provided me with very useful advice, direction and referrals. Best information I have ever received. A ‘must do’ experience.
Thank you so much for our fee only planning meeting. We came away with great information and more importantly understanding and knowledge about our future. Thanks for taking the time to explain thoroughly any questions or inquiries that we had.
Jim and Debbie Dymianiw, Calgary
Our meeting with Jim was so enlightening. It’s great to get informed feedback about our strategy and we feel much more empowered to be proactively involved in our financial decision making from here on out. What a great feeling!
Advice over Products
I am passionate about helping people make better decisions with money. One of the challenges is finding good unbiased advice in an industry that primarily compensates and motivates financial advisors with commission. As a result, too much of the industry is product focused as opposed to advice focused.
I am not against products and I am not against professional advice. I just think planning and advice should come before products.
The problem with the conventional model is in order to get paid, you have to sell financial products like mutual funds, GICs, stocks, insurance, etc. You can have great intentions but in the end, you still have to make the sale to make a living. I know because I used to be one of those licensed advisors.
In 2007, I sold my business for a number of reasons, one of which was I was frustrated at how the regulators were starting to dictate how financial advisors could run their business and force everyone to manage money the same way. As a result, all investing is starting to look the same.
Paying for time, expertise and knowledge
Today, I still work with clients but only on a fee only basis. In other words, I do not sell products, I only offer advice and people simply pay me for my time. I guarantee you that you’ll get your money’s worth. In fact, I have never had a client where I did not make back the fee they paid me and more by helping them reduce the fees on their investments, recognize tax savings strategies, create more efficiency with their financial assets, recognize where financial products are more sizzle than substance, and more.
I am passionate about education and knowledge. I have committed so much time through my articles, workshops and products to help people make better decisions with their money. People can pay me to develop complete plans but I think they can save a lot of money by just booking an hour and a half meeting to learn more and take away an action plan of things for them to work on. This model has helped hundreds of people and they do not need to pay thousands of dollars for me to create a plan.
My goal is not to sell you financial products. My goal is to make a difference. Here’s my motto “Give someone a fish and they eat for a day. Teach someone how to fish and they eat for a lifetime”.
Commission vs Fee-based vs Fee only Advisor
Sometimes there is a mystery as to how and how much financial advisors get paid. Naturally, I believe advisors should get paid for the service they provide. However it is imperative that investors start asking more questions around compensation. There are three main types of advisors:
Commission based Advisor. The majority of financial advisors are commission based. These advisors get compensated by selling products like mutual funds, stocks, GICs and insurance products. There are often two key concerns with commission based advice. The first concern is whether you are getting good financial advice and planning as opposed to just buying financial products and the second concern is whether the amount of commission on different products affects the types of products being recommended.
Fee-based Advisor. There are a growing number of fee-based advisors who charge a fee for their services but the fee is still tied to the size of a portfolio. Usually the fee is expressed as a percentage of assets. For example, a fee-based advisor might charge 1% on the assets and as a result there would be no additional trading costs. The advantage with fee-based advice is it can account for clients with different portfolio sizes. For example someone with $1,000,000 might negotiate a lower fee than someone with $100,000. The fee is more transparent than the commission model but investors need to be aware that they might get charged the advisor fee and be paying another layer of fees and compensation from the products that are recommended. This is commonly known as double dipping and should be avoided at all costs. Because product is still being sold and managed, there is still a potential conflict of interest.
Fee only Advisor. The rarest form of compensation is the fee-only model. This is where fee only advisors do not sell products and only get compensated by charging for their time. Hourly rates can range from $75 per hour to $500 per hour depending on the experience and services. With fee-only planning there is usually less focus on product and more focus on planning and advice. The biggest challenge with fee-only advisors is they cannot help implement plans through financial products.
At the end of the day, there are good advisors and bad advisors no matter how the advisor is compensated. It is important that clients/investors ask questions about how and how much advisors get paid. You have the right to know!
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