10 Vital Questions To Ask Your Financial Advisor
6. How do I pay for your services?
Ensure that you understand what all is included in the fee and if any additional costs for preparing a statement of advice (SOA), implementing the advice, any revisiting charges if your circumstances changes in the future.
Tell your advisor to give it in writing that how much he will charge for the services they provide. Advisors are paid in three ways-
From the cost of the product- When you purchase a product from the planner, they will receive their compensation directly from the product manufacturer as part of the management fee of the fund. In this case of payment no money is exchanged between the client and the planner, instead the cost to the client is embedded in the cost of the mutual fund.
Percentage of assets under management- Under this payment mode few planners will charge a fee as a percentage of the assets they managed or administered on your behalf.
Fee-for-service- Some planners charge for an advice they give you for an hour.
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