How financial advisors get paid may seem like a simple question, but the answer is actually quite complex—and too often unknown.
Advisors have numerous methods in how to get paid, and compensation is affected by a variety of factors, including the type of advisor and client relationship and changing trends. While some may disagree, there isn’t one right answer to how financial advisors should get paid. In fact, many follow multiple paths. For advisors and clients, understanding the factors, options and trends can help all stakeholders ensure the compensation is fair, clear and understood.
The mindsets behind advisor compensation are also evolving. New technology, customer demands and market changes have impacted how clients view investing and how advisors get paid.
A lack of clarity around compensation structure can keep prospective clients from connecting with your firm and leave current clients hesitant to grow.
Almost all compensation strategies fall into four main categories. Create clarity with our guide – review four of the most common pay structures and explore the factors that likely impact which one you’ll use.
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