Just like there are different types of investment advisors, there also are several payment plans. Taking the right payment plan could save you a considerable amount of money. Factors such as your knowledge of investment planning, the type of investment and the amount will influence your decision as you try to find a financial advisor.

Commissions

A Commission is one of the ways that an investment consultant gets paid when you consult him. It is important to note that this type of an investment planner does not work under the fiduciary standard and is probably just a sales person for the company trying to sell accounts. Some of them have the right qualifications and can give sound advice, but they still could have their own self interests.

One of the payment options that you will be given when you find a CFP is to pay a percentage of the assets. The fee may be 0.7% to 2% of the portfolio of assets that you are seeking his advice on. The bigger the portfolio, the less you may have to pay. For a small portfolio, the expenses can be significantly higher than other options, given the fees against the portfolio.

Paying a percentage of the fee is a great option for someone who is seeking investment planning and has little financial knowledge of how such asset portfolios work. The CFA has an incentive to make an effort to guide you.

Flat fees

When you find a CFP, rather than a broker, they are likely to charge a flat fee, an hourly rate or a percentage of the assets that you will be seeking their advice on. The flat fee is simply a fixed payment that you will have to pay for some investment advice and is not pegged on any assets.

The fee may be about $1500 for the entire project. This type of fee is suitable for people seeking some advice on a one off project and need the investment planner to help them come up with a sound plan on how to improve the investment.

Hourly Rates

An hourly rate could be perfect for someone who has some investment knowledge and can work on his own. He only needs to find a financial advisor who can help work on his investment plan. It is not the best option for someone who is not experienced and does not have adequate investment knowledge. The hourly rates can add up to a considerable bill that you were not ready to pay.