How much does a financial advisor cost?

Advisor pricing ranges widely, and the same service can cost twice as much at one firm as another. Understanding the common models helps you compare quotes and spot when a price doesn’t match what’s included.

Percentage of assets

This is the most common model for ongoing investment management. Many advisors charge around 1% a year on smaller balances, often with lower rates on larger accounts. On $500,000, a 1% fee is about $5,000 a year. Ask how the rate changes as your balance grows.

Flat and hourly fees

Common for financial plans and one-time advice. You pay for the work regardless of how much you have invested. Hourly planners often charge somewhere in the low-to-mid hundreds of dollars per hour, and comprehensive one-time plans can run from about a thousand dollars to several thousand, depending on complexity.

Subscriptions

A monthly or annual fee for ongoing planning and access. This model is growing, especially among firms serving people still building their savings.

Costs on top of the advisor’s fee

• Fund expenses inside mutual funds and ETFs, from a few hundredths of a percent for index funds to over 1% for some actively managed funds
• Trading or custody fees
• Costs built into insurance products and annuities

Always compare the total yearly cost in dollars, not just the advisory fee.