What does Fee-Only mean?

According to national surveys, clients want an unbiased opinion regarding financial planning. Rather than be “sold” products, clients want objective advice and education regarding appropriate strategies. That’s precisely what a Fee-Only financial advisor offers. The "Fee-Only" status is a critical distinction in the financial service industry.

For a specific fee, not a commission, our Fee-Only advisor will educate you and coordinate your insurance, investments, taxes, estate planning, retirement, and other issues relating to your financial situation. Fee-Only advisors bring an objective point of view into your financial picture. And because Fee-Only advisors do not have quotas to make and do not receive compensation based on product recommendations implemented, they can offer objective financial planning advice without a bias agenda.

CCP, Inc. is a Fee-Only investment advisory firm. We work solely for our clients, eliminating the compensation conflict of commissions. We utilize only no-load mutual funds. We will make recommendations on specific investments but we are not paid to sell any products such as funds or insurance. Therefore our only allegiance is to you, the client and the service we offer you. If you are looking for objective advice, you can’t ignore the question of how the advisor is compensated.

Financial advisors generally receive compensation in one of three ways let us look to better define the various fee structures of financial planning services available.

Commissioned financial service provider: this individual may (or may not) provide full financial planning at no or a reduced fee with implementation of recommendations associated only with their specific product that provides payment to them based upon client purchase. Typically this is called a "load" but it can also be a 12b1 fee, surrender charge, or other compensation (soft dollars, trips, etc) based on sales and volume. It is possible, even probable, that you will not see this fee directly but with research and reading you will find full disclosure.

Fee based/fee and commissioned/fee offset financial service provider: This financial service provider may (or may not) provide full advisory services and generally receives a fee for the service and additionally receives a fee for product implementation. Again, this may be called a "load" but it can also be a 12b1 fee, surrender charge, or other compensation (soft dolars, trips, etc) based on sales and volume. It is possible that you will not see this fee directly but with research and reading you will find full disclosure. Many professionals use the term "fee based" synonomously with "fee-only". Be sure to ask.

Fee-Only financial service provider: This financial service provider may (or may not) provide full advisory services with no commissioned compensation for implementation of product. There may be product fees associated with implementation, but this fee does not get paid back to the Fee-Only service provider. As with any products or services, there is always a fee or something to generate fees; nothing is free. The aware/astute consumer reviews the alternatives and makes an educated decision based on the availability of the services and their needs.

It is our opinion that financial planning services should not be purchased based on cost but rather matching individual personalities with planner and the philosophies of the firm they represent. This involves specialties needed, personal constraints and chemistry of the individual and the planner. This is where you need to think through what you are looking for in a financial advisor:

  • What financial services do I need and or want?
  • Have I defined my goals?
  • Do my goals align with my resources?
  • What resources are available to me? Are they providing what is needed to resolve my situation?
  • Am I implemented and organized to accomplish my/our short, intermediate and long term goals? Are they properly defined?
  • Do I adequately utilize professionals to maximize my potential for success?

After thinking through your situation and looking to further define your financial planning needs, look to our services to put your needs into action.