What is a Fee-Only Financial Advisor?

OHF's services are strictly fee-only. That means we do not receive commissions from the institutions and investments we recommend to our clients. It means we work for you, not for commissions. It also means that we are not obligated to any bank, brokerage firm or insurance company in recommending products and services for you.

We are Fee-Only because we believe people deserve access to unbiased financial advice, and we want to work solely for our clients. For this reason we are compensated only by fees paid by our clients and only by a previously agreed upon fee arrangement. As Fee-Only advisors, we do not accept commissions or receive any other compensation for recommending specific products. In this way, we can be completely objective in our evaluations and we can recommend a course of action based only on strategic financial considerations. As Fee-Only planners, we believe there is a significant conflict of interest if an advisor gains financially from the purchase of any product he or she recommends to the client.

In America today, Fee-Only Planners represent only a very small percentage of the total population of Financial Planner/Advisors. Most financial planners are compensated partly or entirely by commissions from the providers of the products they recommend and sell. If the planner or advisor is not 100% commission based then they are referred to as fee based or fee offset, and both charge a fee and receive commissions from selling products. We are neither.

As fee only advisors we develop and implement a plan that shows clients how to attain their financial goals. Because investment alternatives are often greater than those offered by commission based planners, there may be an opportunity for better investment selection. The same is true with insurance. As fee only advisors, we recommend investment and protection opportunities that are not commission driven.

NEWSWEEK - Jane Bryant Quinn "Financial Planners who take commissions have a built-in conflict of interest…even with disclosure, my choice would be a fee only planner."

MONEY MAGAZINE "Start with the general practitioner…a Financial Planner (whose) compensation should be from fees alone."

FORBES "The most important matter is how the planner is compensated. Hire the planner who…has no financial stake in (your) investments." >

The "Fee-Only" designation is defined by the Certified Financial Planner Board of Standards as: "... planners, firms and services that are solely compensated by client fees. Examples of fee-only planners are those who accept only fixed or flat fees from all clients, those who are compensated by percentage fees based on their clients' financial profiles, and those who receive performance-based fees linked to the profitability of the clients' invested assets. The same criteria apply to use of terms such as "fee-only firm" and "fee-only services."

Click here for the entire article by the CFP Board.

Fee-Only Financial Planners are independent of insurance companies, securities companies, etc, so are free to advise the client in the client's best interest without consideration of a commission the advisor might otherwise make. The Fee-Only Planners are compensated in the following ways:

Flat fee or retainer An hourly fee A percentage of assets A project fee A percentage of income

For a full explanation of the Fee-Only Advisor's role and responsibilities, see the NAPFA website at http://www.napfa.com.