How to Invest Your Money » Investing

Need Financial Advice? Consider a Fee-Only Financial Planner

Need Financial Advice? Consider a Fee-Only Financial Planner

We all need a little help with our finances sometimes. Especially as we get older, and our finances become more complex. Just think of the financial planning that retires, sending kids to college, investing for income, estate planning, etc. It only makes sense to consult a professional about these matters.

Even if it’s a little help figuring out your budget, or making a plan to reduce your debt, financial planning services are beneficial. But who should you approach – a financial advisor, a certified financial planner? It’s important to understand that not all financial planners are the same. Financial planners have different experience levels and charge fees at different levels.

This article will explain the benefits of dealing with a fee-only financial planner. If you are looking for someone to help you and who has your best interests in mind, you should consider a fee-only financial planner.

What are Fee-Only Financial Planners?

Fee-only financial planners charge an hourly or flat fee for their services. For example, they may charge you $100 per hour, or more, to create a detailed financial plan. When it comes to managing your investments, they may charge a flat fee, say $1500 per year. Or, they may charge you a fixed percentage based on your overall portfolio value or assets under management (AUM).

For example, if you have a managed portfolio of $250,000 and their fee is 1%, your cost is $2500. In this case, it’s in your planner’s best interest to help you grow your portfolio, as it will equate to more money in their pocket, not just yours.

What you get for that fee will vary depending upon the planner and their respective services. Fee-only planners lay out the costs so that you know exactly what you are paying for and how much.

Commission-Based Financial Planning

Historically, many financial planners have been compensated through a commission-based model. This means that they receive a commission on the sale of a mutual fund. Some funds pay a better commission than others, leading to an inherent conflict of interest. A commission-based planner who places more trades or chooses higher MER mutual funds can make more money to the detriment of their client.

Even though the fund might not be what you need for your portfolio, a commission-based planner might steer you toward what offers the most significant commission. Paying these higher hidden expenses could cost you more in the long run, especially if you’re not on the financial path that’s right for you.

You have to be wary of commission-based financial planners because they don’t get paid based on how well your portfolio is doing; they are paid based on what they are selling you. It’s more about making sure their bottom line is bigger in the long run than it is making sure that you have a portfolio suited to your needs and risk tolerance. Between the possible under-performance and the higher MERs, you could be leaving tens of thousands of dollars on the table over time.

While I’m sure many commission-based financial planners do not let this sway their decisions, going with a fee-only financial planner, at the very least, gives you peace of mind that both you and your advisor are working toward YOUR goals.

Advantages of a Fee-Only Financial Advisor

There isn’t much in life that is exclusively advantageous. But there are many advantages of choosing fee-only financial advice over the alternative. Let’s take a look at the positives of fee-only financial planning:

Freedom from Some Conflicts of Interest

Because a fee-only planner’s compensation isn’t coming directly from the sale of investment products, the investor can rest assured knowing that their investment advisor isn’t making choices based upon what will enhance their profitability. It doesn’t guarantee that they’re making the right decision, but some conflict of interest is removed.


Fee-only planners can act as objective financial partners. They are less likely to act with bias about your financial situation because they aren’t benefiting based on the types of investments you choose.

Disadvantages of a Fee-Only Financial Advisor

Fee-only financial advisors can be costly, and have other conflicts of interest, even if they don’t pertain to the sale of specific investments. Here are a couple of potential drawbacks to dealing with a fee-only planner.

Can be Expensive

If you hire an advisor who charges a flat fee of $2500 for annual financial planning services, regardless of portfolio size, the cost is certainly not equal for everyone. If you have a $500,000 portfolio, you’re getting a great deal – a $2500 fee equates to 0.50%, which is very competitive for professional financial advice. But what if your portfolio is only $50,000. In that case, the fee is 5% of the overall portfolio, and certainly not worth it. The fee is transparent, but far too costly to consider for someone with a smaller portfolio size.

Potential Conflicts of Interest

I may sound like I’m contradicting myself here. Didn’t I previously mention that fee-only planners are free from conflicts of interest? The answer is yes for some, but not all. Conflicts of interest can still exist. If your planner charges a fee on the percentage of assets under management, they may steer you away from any decisions that could reduce your overall portfolio value.

For example, let’s say you have a $200,000 portfolio, at 1%, and you wish to withdraw $50,000 from your investments to purchase a new SUV. Your planner might be tempted to recommend that you borrow the money via a car loan, instead of withdrawing from your investments – even if paying for the vehicle with cash is the smarter choice.

Fee-Only vs. Fee-Based Planners

You may have heard of a fee-based financial planner. While the name sounds familiar, a fee-based planner is very different from a fee-only planner. For starters, under the fee-only model, the planner is paid directly by the client. They are not compensated by the investment funds, and they don’t earn a commission every time they place a trade. A fee-based financial planner may charge a fee directly to their client, but they can also receive incentives, in the form of commissions, from the investment funds that they sell.

In addition to compensation, fee-only financial advisors have fiduciary responsibilities. That means that they must put their client’s best interests first when making any investment decisions. Fee-based financial planners don’t share the same responsibility. Instead, they have a responsibility to ensure that the investment they are purchasing is considered “suitable” for the client. A suitable investment is one that aligns with the client’s net worth and risk tolerance – their ability and willingness to take risks. Determining that an investment is suitable is not a bad thing, but it’s a lower standard than what’s required of a fiduciary.

Fee-Only Planners: How to Choose the Right One

Of course, you shouldn’t just hire the first planner to come along, even if he or she works on a fee-only basis. You need to make sure that your financial planner understands your situation and can make reasonable suggestions.

One of the best ways to start figuring out who to hire is to ask around. Ask family, friends, and co-workers for the names of fee-only planners. Then, research their credentials. Find out if they belong to a professional organization, and if they are properly licensed to offer the services that they claim.

Narrow your list down to three or four planners near you, and schedule a sit-down. Many planners will offer you a free half-hour or hour initial visit to look at your situation. Get a feel for each planner’s style. Ultimately, you need to feel comfortable with your financial planner, so this “interview” can be a good way to determine who you will work well with. Ultimately, the right fee-only financial planner can help you get your finances on track, and help you plan for a successful future.


  1. Mike Bayer

    It would be great if you might consider posting a directory that could list the fee only planners across Canada.


    Mike Bayer, CFP

  2. Tom Drake

    Mike, I like this idea. I will look look into getting this set up!

    • Kathy Waite

      There is a list on the MoneySense website. Some are fee based and some fee only. There is a difference. I have seen fee based not want you to take money out as they are paid a % of assets and also put clients in cash and still charge the % on all the assets not just the actively managed so beware and ask questions. Fee only you pay for a project or per hour. Project is more predictable for you. If you have a small account this means you can get help, fee based may only want $250k or $500k plus

      • Kathy

        Just for the record the list on Money Sense used to be free to be listed, they now charge $500 to join and $2500 a year so its back to being a paid advert. If you live in Toronto or Vancouver you will likely find a REAL fee for service on there but if you are in the prairies then you wont. Some of the names that come up also have very large account minimums, if you have under 1 million do not expect a quick callback . On the whole genuine fee for service planners are small one person businesses and only take on 1 or 2 new clients a month as if they have been going for 5 years plus they are nearly at capacity with reviews anyway . I know from hearsay they are quieter in December, January and August so if you want help you are more likely to be taken on as a new client in those months. Good luck! Keep asking why and don’t accept the status quo as your only option. Kathy Your Net Worth Manager

  3. Terry

    I’am looking for a recommended fee-only financial planner in Saint John N.B.,can you help?

  4. KWilson

    What’s the point is providing links to fee-only associations that only list US advisors? Useless!

  5. gary

    Any list of fee only CFP’s in Canada or Saskatchewan that I could access.

    • kathy

      Hello Gary,
      Feel free to get in touch

    • Kathy Waite

      Gary , cant see my contact details showing so here goes:
      kathy @

    • Bruce Thompson

      Hi Gary,
      I am a fee-for-service CFP® based in Regina. After 25 frustration years trying to do the best thing for my clients in our personal financial system and it’s fundamentally flawed compensation model, I have become an associate of a nationwide network of fee-for-service financial professionals (I don’t think I’m allowed to say the name) and finally I really do work solely for my clients. My only regret is that I didn’t do it sooner but, as you can tell, there is not much of a trail blazed in this part of the country yet and it sometimes people a little time to realize that “free” financial planning is very similar to “free lunch”.

  6. Joe

    I am myself looking for a fee-only CFP in Ottawa. Anyone worth recommending???

    • Judith Cane

      Hello Joe,
      I’m a fee for service financial advisor in Ottawa, if you haven’t already found someone you’d like to work with.

    • Imran Syed

      Hi Joe,

      I run a fee only, securities licensed, advisory practice in Ottawa and usually start client engagements at $350,000 of assets.

      Feel free to get in touch through my website if I can help.

      best regards

      Imran Syed BA CFP CFSB TEP

  7. Ansgar Tynning

    is there a directory of fee only financial planners for Saskatchewan?

    • Kathy Waite

      I believe I am the only actual fee only , there are some fee based.
      Kathy Eureka Investor Guidance

    • Bruce Thompson

      Hi Ansgar,
      To the best of my knowledge, I am the only CFP® professional in Saskatchewan who prepares financial plans for clients for a flat fee, who receives NO revenue from any other source. (ie, commissions or referral fees from investment companies, etc.)
      I provide my clients with recommendations that are in my clients’ best interests, because my clients are the only ones paying me…which is as it should be! I love it!!!

  8. Leslie Szilagyi

    Perhaps you might want to comment on regulatory obligations and oversight that is required for hourly fee for service advisors that do not sell product. Please comment outside of designation code of conduct obligations, I’m specifically looking for oversight with teeth.

    • Julie

      If someone is in the business of giving financial advice (other than just financial planning), you must be registered with the OSC. There are very few categories for any independent adviser to be able to register unless they can qualify as a portfolio manager. The only other way is to have a “sponsoring firm” put the adviser under their umbrella. That’s why most fee based planners that go beyond the financial planning process are either licensed as insurance people or Mutual Fund people – in which case they are also paid on commission.

      If you want really and truly unbiased fee only advice – you need to tell the OSC to open a category for independents and regulate them. It starts with consumer demand. Right now it is practically impossible for an experienced, good adviser to become fee only and maintain any sort of registration.

      CANADA does NOT have a regulatory category to register under for a truly independent adviser that is allowed to talk to people about investments.

      Somebody correct me if I’m wrong – but I don’t see it in Canada, just other Countries.

      • Kathy Waite

        Julie is correct. Unlicensed cannot make a buy or sell recomendation on specific stocks or funds and must make it clear to you they do not. They can how ever write you a plan , run forecasts , explain asset classes, risk tolerance, teach you to DIY your own accounts and provide an asset allocation for you to follow, teach you how to rebalance etc. provide tools , spreadsheets.

      • Paul Lambe

        Great comments. Thank you.

        I would like to know more about the option for Fee Only and Fee Based?

        ‘Right now it is practically impossible for an experienced, good adviser to become fee only and maintain any sort of registration.’ You do mean ‘not maitaining’ any sort of registration? Thanks, Paul

    • Paul Lambe

      That is my question Leslie, can we get more comments on this?


  9. longchamp handbags

    this is really cool, I like here

  10. Tim Faunt

    Another great article, Tom – but as a fee-only financial planner in Calgary, I have to admit I may not be completely objective on this topic…. 🙂

    If you follow Tom Drake’s suggestion & put together a directory of fee-only and/or fee-based financial planners, please add me to the list – I offer both, depending on the client`s need for one-time planning vs. ongoing guidance & management.

    Now, I have to go read your article on getting cheap & free TV in Canada – thanks to my Scottish heritage, I`m always looking for a deal!


  11. Julia Chung

    Money Sense magazine has a directory –

    • Jen

      Be careful because most of these lists require the advisors to pay for their listing, meaning that it is essentially an advertisement and not a true, unbiased list. Check the FPSC website for CFP professionals and interview prospective planners. A fee only Financial Planner should not be talking product in the Financial Planning engagement. They will talk about asset allocation but should not be discussing investment products or implementation of the investment plan as part of the planning engagement.

  12. Bob

    You are not clear on the difference between fee-only financial planners and fee-based financial advisors. There is a big difference between the two and you have glossed over that fact.

  13. Kathy

    Hello Bob,
    Fee only planner is often called advice only they don’t sell product they just tell you what you should do. It should be more of an educational, show you your options and tell you what distribution channels out there to choose from.
    Fee based will often write a plan/ educate and charge for it but if you agree to move your investments to them they will charge a % of your assets instead of billing you for the plan.
    There is a lot of confusion and people just have to ask exactly how do you get paid ? Any referral fees? Look for conflict of interests.
    Today I just heard of one saying we are flat fee and they meant flat % not a flat $ amount , just that the % didn’t decrease as the amount you have increases.
    Bit of a minefield.

  14. Paul Lambe

    Great comments. Thank you.

    I would like to know more about the option for Fee Only and Fee Based?

    Also, are most fee-only licensed for IIROC or MFDA?

    Also Kathy, are there many unlicensed financial planners out there providing those comprehensive plans without buy or sell recommendations?

    Any comments would be appreciated.

    • Kathy Waite

      Hello Paul,
      Usually fee based are managing your investment accounts so they charge a % of your assets deducted from your investment accounts. Fee only are financial planners who do not manage your money, its not under their custody or management to deduct a % so they bill you for projects, per hour or an annual retainer.
      Therefore most fee only would not be either IIROC or MFDA.
      Most fee based are IIROC as mutual funds ( MFDA ) have the MER built in and unless you sell a certain class of fund you wouldn’t be agreeing a fee its just the usual 0.5% through your dealer.
      I have heard statistics about 150 fee for service but have only found a handful. I think it tends to be in Vancouver/ Calgary etc and their websites say suitable for annual income over 1 million , accounts 1 million etc
      I don’t have a minimum account size. I find people who can’t get help because they have a small account are still often willing to pay for an independent view or help planning.
      Sometimes they have large DB pensions or property but not much in the way of investable assets . So they go in the bank or MFDA guys place and don’t get a call back even. Yet they want to know if and when they can retire etc.

      I believe in separating out sales from advice so you know there is no hidden agenda. We don’t let Doctors sell drugs do we.

      I refer to Your Investment Manager Benjamin Waite IIROC who charges a flat fee for money management not a %

      i would like a fee only insurance and mortgage broker ….working on it.

      • Bruce Thompson

        A few of my colleagues across Canada are sitting on a committee to rework the existing MoneySense fee-for-service / fee only (two different things but unfortunately, not even the industry can seem to agree on what each term means) Canada-wide directory.
        As I understand it, the directory will still be free for the public to access but, unlike now where being included in the directory is free, there will be a substantial fee to be included in the directory. I believe that’s actually a positive thing for consumers and planner alike because I believe they are planning to do a certain amount of vetting of planners to protect consumers and additional promotion of the directory which will benefit planners and, ultimately, consumers.

        MoneySense has been a strong proponent of the fee-for-service financial planning delivery model as it is the only way that the advice can truly be unbiased. A number of my existing clients learned of the concept and/or found me by starting at MoneySense, despite the fact that I switched to fee-for-service just after they stopped accepting names for the existing directory.

        Also, to help clarify the meaning of the two offerings, MoneySense, as I understand it, also plans to split the directory into two directories:

        – terms used by MoneySense to describe those of us who charge a prearranged flat fee (or perhaps hourly fee) for financial planning services
        – could include: goals planning, insurance planning, education planning, cash flow planning, debt reduction strategies, tax planning, retirement planning, investment planning, estate planning, small business succession planning
        – typically NOT licensed to sell investment or insurance products (thus, truly unbiased)
        – the financial plan would recommend insurance and investment vendors to fulfill the needs and implement the strategies identified in the financial plan.

        ASSET BASED PLANNERS (sometimes referred to as FEE-ONLY PLANNERS) charge a fixed percentage of your portfolio (i.e. 1% of assets) to manage your investments, rather than charging you transaction fees when the portfolio is re-balanced or the asset mix is changed.
        – % fee may or may not include any financial planning elements (as listed above) other than investment management
        – May offer other elements of financial planning for an additional fee, over and above the % of assets
        – REQUIRED TO BE licensed to sell investment products and may also be licensed to sell insurance products.
        – less biased than commission based advisers, but still there is still a built-in bias towards recommendations that will increase the size of your portfolio, vs recommendations that might temporarily or reduce the size of your portfolio (i.e., paying down debt, Home Buyers Withdrawal, gifting to children/family, charitable donations and philanthropy, and (let’s not forget) SPENDING for the enjoyment of life!

        Hope this helps!
        …Bruce Thompson

  15. Potato

    Hi Tom and everyone: MoneySense has taken down their directory of fee-only planners (in advance of their “approved” offering), so I’ve created a new directory of fee-only planners, coaches, and advisors:

    Hope it’s helpful for everyone!

    • yves boudreau

      Thank you. I am looking for a fee-only planner in New Brunswick or Nova Scotia. Would you know of anyone. Thank you.

  16. Gina Macdonald

    Go to the website as search by method of compensation.

    As of 2015, Moneysense magazine is now charging advisors thousands of dollars a year to go on their directory, so it’s now just an advertisement not an independent listing of professionals.

  17. Kathy Waite

    Just Google fee only planner and your province

  18. David


    I am planning to retire next year and want to seek an advice to see what is the maximum income on my retirement life to get the max benefit from the government. Should I need to see an financial advisor for the planning? Any recommendation in Toronto? My total annual income (together with my wife) is around $85,000.

    • Bruce Q. Thompson

      Hi David,
      If you’re looking for someone in Toronto, Noel D’Souza with Money Coaches Canada is excellent. ([email protected])
      I’m located in Regina but I have clients are far East as Ontario and as far West as BC that I work with by phone & email , so I could also assist you, if you like.

  19. Mark

    David says:


    we are planning to retire by July 2016 when I am 65 and my wife is 60, because of volatile market we transferred our RRSP to GIC we are looking for a financial advisors to help us getting back to the market whenever market starts picking up reasonably, we also want to seek an advice to see what is the maximum income on our retirement life to get the max benefit from the government. I live in North York and I need a experience advisor. Thank You

    • Bruce Q. Thompson

      Hi David,
      Over my 25+ years in the financial services industry I’ve had many clients who have sought the shelter of GICs or money market investments during times of abnormal volatility. While I could understand their logic, I always shared one piece of advice with them: Markets don’t tend to, “settle-down”; they tend to, “settle-up”. That is to say, once the “storm” has passed, the market is often higher than it was during the storm.
      The other important thing to keep in mind is that you will not be needing all of your retirement savings at the same time. You may well need some of it to supplement your cash-flow over the next few years, but, you’ll also likely need some of it in 15 – 20 years.
      What I typically recommend for my retired clients is to have 18-24-months worth of required cash in money market or short-term GICs. They won’t make you rich, but they don’t drop in value either. Then have a second pool of savings in long-term GICs, medium term bonds (perhaps), etc., that will earn a little better return, but is still relatively safe. Then have a third pool that is invested in equity investments. When conditions are favourable, we take some profits from the second pool and add them to the cash pool, to maintain that 18-24-month “buffer”. Likewise, when conditions are favourable, we take some profit from the equity pool and use it to replenish to second and/or cash pool. When conditions aren’t favourable to take profits, we ride it out, knowing that we have a 2-layer buffer between their day-to-day retirement spending and the stock market. Of course, the size of each pool depends on a number of factors, not the least of which would be your other retirement income, and income tax considerations.
      I am a fee-for-service financial planner (CFP®) with Money Coaches Canada.
      Please feel free to email me if you would like to discuss it further.

  20. Fiona

    If I have a 1 mill+ in assets (theoretically speaking), would it be better to get a fee-only one time planning session and manage the assets myself or hire an advisor to manage the assets? I have no financial background other than reading books and being smart.

    If I am paying someone to manage the assets, it should be active-managing. From the managers I have seen so far (toronto) very rare ones know how to actively manage.

    • Kathy

      Hello Fiona, it would be impossible to learn to manage your assets yourself in one planning session.
      About 5% of my clients are DIY investors and its usually people who consider it a hobby and they still want someone to bounce ideas off.

      Two options 1) if DIY have a fee only only planner on annual retainer so you can call and them keep you on the straight and narrow when you are freaking out about markets 2) if you pay for money management only pay for the work done. If you want active you should be paying about $650 month for a family if you want indexing about $350 per family regardless of size of assets . Avoid those who charge a % . if you don’t have much you can’t get any help , if you have a million you pay way to much and it keeps increasing.
      I refer to portfolio managers who give us a quote to implement the strategy our plan indicates we need.
      Does that help?
      Feel free to message me if you have more questions
      Kathy [email protected]
      My face book page is

    • Bruce Q. Thompson

      Hi Fiona,
      Generally, I agree with Kathy’s comments regarding managing your investments. Any fees that you pay should reflect the complexity of the solution and the value it provides you, rather than the size of your portfolio.
      If you researched for months, and interviewed many investment advisors, you might, in theory, find one who could consistently out-perform the pack. However:
      • You could also end up giving a big chunk to the government by paying more income tax than you need to.
      • You still might not be satisfied with the rate of return because you don’t know if it’s high enough to make your savings last long enough
      • You might be afraid to enjoy your retirement income because you don’t know if it will run out too soon
      To avoid this, prior to making any decisions regarding investment advisors, I strongly encourage you to engage the services of a fee-for-service financial planner who is a CFP® professional, to work with you in developing a comprehensive financial plan. The plan would explore and document your financial goals (including estate goals), your current situation, various scenarios to determine what rate of return you will require on your investments in order to accomplish your goals, the level of involvement that you would like to have (or not have) in the management of your investments, and any tax considerations during your retirement and in your estate. The plan, taking all of those things into consideration, would also include recommendations for where to invest your money, how it should be invested, and how it should be managed, over time, to minimize the impact of income tax on your retirement cash-flow and on your estate.
      Hope this helps. Please email me if you have any questions.
      Bruce Q. Thompson, CFP®

  21. Brenda Hiscock

    Good Day,

    I am a fee-only Financial Planner based in Vancouver, working with Objective Financial Partners. Our Managing Director, Jason Heath is a regular contributor to MoneySense, the National Post, and various other publications.

    We deal with clients across Canada, and with expatriates worldwide.

    Let me know if I can be of help.

    Thank you,
    Brenda Hiscock

    • Susan

      Who should I contact in Montreal?

  22. Kevin O'Brien

    This article is misleading- Fee only financial planners DO NOT SELL PRODUCT they are paid 1 of 3 ways ONLY. Paid by an Hourly Rate (example $450/ hour) , Paid by Engagement ($5,000 – for a financial plan) or by retainer (usually a corporate client and it depends on the scope of engagement). What you described is a FEE BASED Financial Planner – They are paid according to the size of the account and are considered AGENTS or SALES Reps….

    • Tom Drake

      Hi Kevin, I’m not sure if you just skimmed, but the only place I see mention of selling is when describing commission-based financial planners. If I missed something, please let me know, because I do agree that fee-only should mean… only paid a fee.

  23. Joe Barbieri

    I am a fee-only financial planner based in Toronto. Most of my clients are in the Toronto GTA, but thanks to technology, I do have clients across Canada. I have no asset minimums and do not sell product. My web site is and visit the contact us page for location and contact details.



  24. AG

    Any recommendation of a fee-only adviser in Montreal?

  25. Nancy Mable

    Thanks for sharing this post with right moves. I would recommend hiring a professional financial planner from your local area would make sense. You can meet in person and discuss your financial planning needs. No matter you are retiring or planning your retirement, visit financial planners and get a healthy financial road-map for spending a successful and happy life.

  26. Susan

    I am in Montreal and my assets are under 500K. I am not an investor, per se, but I have RRSP’s and am 63 years old. I want have advice from someone on when to retire, when to start collecting my Federal & Provincial pensions and what to do before I reach 71 and have to do a RRIF so I can save on taxes? Can anyone suggests someone to contact and what it should cost?

Leave a reply

Your email address will not be published. Required fields are marked*