When it comes to dealing with a financial planner there are two major categories they fall into-those that are fee-only and those that charge according to products or services rendered. Picking the right planner for you is every bit as important as managing your finances to begin with!

Fee-only structures are where you pay a set rate to the planner in exchange for advice or time. They will never charge you directly for products or services because they are already being compensated. A product structure is where you only pay them when you want to buy one of the things they suggest. This may sound more reasonable but most analyst's think that it is far safer to make it so your planner never has any temptation to give you bad advice to begin with.

I think it is vital that people get a fee-only financial planner because they will no longer have conflicts of interest with regard to product sales. When you go with the commission method they are going to want to buy you the most expensive services and products simply to increase the profit margin.

Doing this will allow the planners to get more personalized and put the effort into getting you the best possible product since they are getting paid either way-as long as you continue booking them.

I think in the world of financial planning there are two different things you have to worry about most of all. Whether or not the planner is verified and whether or not they have fee-only structures. If the answer to both these questions is not yes, then keep looking.

Learn more about this author, Royce Radcliffe.
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