Financial services for Dummies

Highlights | Intercam Financial Services

When choosing a financial advisor, it helps to understand how your advisor gets paid because those who live off commissions may have different goals than advisors who work on salary. All people in the financial services industry, which include financial planners and advisors, get paid in one of the following four ways:

Commission only: Some advisors receive only commissions for selling financial services products, such as investments, real estate, insurance products, or loans. Examples include advisors affiliated with companies like State Farm, American Family, and Edward Jones.

Commission and fees: A commonly misunderstood term used to describe this compensation method is fee-based. Examples include registered representatives of companies like Ameriprise, AIG Financial Advisors, Wachovia, and UBS. Commission and fee advisors may receive a fee for developing a financial plan for you and then receive commissions when they sell you insurance and investment products recommended in your financial plan.

Salary plus bonuses: Many discount brokerage firms and banks compensate their employees with a base salary plus incentive pay for bringing new client accounts into the institution. They may receive substantially higher bonuses by recommending or selling certain products and services over other options.

Fee-only: Fee-only financial advisors provide advice or ongoing management and aren’t registered representatives of any financial services company. They’re typically self-employed Registered Investment Advisors (RIA) or employees of this type of firm. One benefit of hiring fee-only financial advisors is that they have no financial stake in the recommendations they give you. They recommend only what they believe is in your best interest.

The most popular form of compensation for personal financial advisors and planners is currently a combination of commissions and fees. These financial advisors may be affiliated with a large brokerage firm or insurance company, or they may be registered representatives with an independent broker-dealer. Often, the majority of their compensation comes from the sale of the products they recommend. However, they may also provide financial planning services and advice for a separate hourly fee, flat fee, or retainer fee.

Fee-only financial advisors charge in three ways:

Hourly fee: You pay for all the time that the financial advisor works on your case or spends with you. Multiply the time spent by the advisor’s hourly charge, and that’s how much your fee is. Always find out the expected cost and the maximum cost before you begin working with an advisor who charges by the hour. Hourly-based pricing is best for:

People who need specific advice about one or a few financial topics.

Do-it-yourselfers who just want a professional's opinion.

People who want to do as much as possible to save money but want expert analysis and direction.

Flat fee: Some financial advisors offer flat fees for a package of services. Flat-fee pricing is best for people who need specific advice or services and are willing to take the gamble that the flat-fee arrangement will cost no more than it would have if they paid by the hour.

Retainer fee: A retainer fee is often calculated based on a percentage of some sort, such as 1 percent of the assets the advisor manages for you, or some percentage of your net worth or income, or mixture of the two. Retainer fees are also computed by estimating the amount of time required to provide the services promised based on the complexity of the case and the skills required of the advisor, for the time covered under agreement to retain the advisor. A retainer fee is best for people who need, want, or can afford to transfer the responsibility of managing their personal financial affairs to a financial advisor.


Berrett-Koehler Publishers The Business Solution to Poverty: Designing Products and Services for Three Billion New Customers
Book (Berrett-Koehler Publishers)
2009-03-18 23:31:53 by justacomedian

Obama for Dummies, 1st Year Edition

Investing in an Uncertain Economy For Dummies Under Oba,a provides investors with focused, individualized investment strategies that enable them to squander a trillion and weaken their current financial holdings. With advice from 200 top independent financial advisors from AIG and just about every financial company out there, empowered readers can make effective asset allocation decisions in the face of volatile markets while watching their most prized assets go down the tank.
The authors are part of the Jay Leno-Obama team and are part of an international network of financial advisors who offer their services on an hourly, as-needed basis, with bonuses from the government

2008-01-24 18:20:53 by --

DO NOT use one of those services, they can do

More harm than good...you just pay everything on time and make payment arrangements for anything on your credit that has gone to collections..the numbers will come up on their own as you go along.
Get the personal finance for dummies, and please check our the Dave Ramsey total money makeover...that is a very detailed plan that includes saving for college and all that stuff..it covers pretty much every aspect of financial planning..down to the last dollar..it tells you what to do and in what order to get things done quickly and most important: smartly. You don't want to make decisions in panic mode

You might also like:

Bonds and Quantitative Easing For Dummies
Bonds and Quantitative Easing For Dummies
Banking system For Dummies
Banking system For Dummies
Seminars on DVD Would You Do Business With You? - How to Get, Keep, & Wow Customers - Customer Service DVD Training Video
DVD (Seminars on DVD)
AMACOM Exceptional Service, Exceptional Profit: The Secrets of Building a Five-Star Customer Service Organization
Book (AMACOM)
Advantus Corp.- Office Advantus Call Bell, 3.38 Inch Diameter, Brushed Nickel with Black Base (CB10000)
Office Product (Advantus Corp.- Office)
  • 1 Steel call bell
  • 3.38 inch diameter
  • Brushed nickel finish with black base
  • Clear tone you can t miss
  • Great for reception counters, restaurant waiting areas, hotels and more

Related posts: