When it comes to your finances, one of the most important questions you should always have a clear answer to is: What am I paying for, and why?
Unfortunately, not every financial advisor makes this easy. Hidden commissions, complicated fee structures, and sales-driven incentives can leave clients uncertain about where their money is going—or worse, paying more than they realize. At Kinetic Wealth, transparency isn’t optional; it’s the foundation of how we operate. To us, it’s not about just notating the right disclosures in fine print; it’s about our clients finding understanding and confidence in their decisions.
Why Fees Matter in Financial Planning
Financial planning is about trust. You’re asking someone to help guide your financial future, and you deserve to know exactly how that advice is structured and what it costs.
According to a 2022 study by the CFP Board, nearly 1 in 4 investors said they didn’t fully understand how their advisor was compensated. This lack of clarity can lead to conflicts of interest and, at times, misaligned recommendations.
That’s why it’s crucial to understand the different fee models used in the financial services industry and the pros and cons of each.
Common Financial Advisor Fee Structures
- Commission-Based
In this model, advisors earn varying amounts of money when they sell financial products like mutual funds, annuities, or insurance policies. Each product compensates the salesperson in different ways and amounts.
Potential Problem: This creates conflicts of interest between the advisor and their client. Advice is likely influenced by varying commissions rather than what’s best for the client.
- Fee-Based
This model includes a mix of fees and commissions. An advisor may charge a fee for planning and/or investment management but can also earn commissions on products they sell to their clients.
Potential Problem: While marketed as flexible, this model may still lead to blurred lines and potential conflicts.
- Fee-Only (Kinetic Wealth’s Approach)
Advisors are compensated solely by their clients—no commissions, no kickbacks, no hidden agendas.
Benefit: Although it’s not possible to completely eliminate all conflicts of interest, this model has the least potential for conflicts between advisors and their clients providing a sound foundation for true fiduciary advice not afforded by other models.
Many reports suggest less than 5% of financial advisors operate as true fee-only fiduciaries.* That rarity is what sets firms like ours apart.
Why This Matters to You
For those who decide to engage a trusted financial partner, cost should never be a mystery. Transparency allows you to:
- Know your advisor’s incentives are aligned with your goals
- Clearly evaluate the value you’re receiving for the cost and easily compare to alternatives
- Plan confidently without wondering about hidden fees
At Kinetic Wealth, we don’t just manage money—we help clients feel confident about the decisions they’re making. And that includes knowing exactly where their money is going.
Final Thought
The cost of financial advice shouldn’t be a question mark. It should be a straightforward conversation, grounded in trust and transparency.
At Kinetic Wealth, our fee-only, fiduciary model ensures that the only people we answer to are our clients. That’s the way it should be, and it’s the way we’ll always operate.
*Source: https://www.humaninvesting.com/450-journal/only-5-percent-of-advisors-are-true-fiduciaries