What is a fee-only financial planner?

This question has been coming up a lot lately from our clients and others, who wonder about the difference between fee-only advisory firms (like Chicory Wealth) and those that are fee-based. It’s an important distinction, so let’s explain it.

“Fee-only” is exactly like it sounds – no hidden or commission-based fees. Because Chicory Wealth is a fee-only practice, our clients pay a flat fee for financial planning services and a separate percentage fee for managing the clients’ assets. We are never paid by commission for selling other products, meaning fewer conflicts of interest. Simple.

The other distinction about fee-only advisors is that they are “fiduciaries,” meaning they are required to act in their clients’ best interest first and foremost. Chicory Wealth is a registered investment advisory practice with certified financial planners. These designations require us to be fiduciaries, which is absolutely what we want to be.


How does a fee-only financial planner compare to a fee-based one?

When it comes to financial advising, “fee-based” is a broader, looser term than “fee-only.” A client will likely pay their fee-based financial advisor a fee, but the advisor might also receive payment from other parties by selling the clients products like insurance, mutual funds, or annuities. Fee-based does not require the advisor to be a fiduciary.


Five reasons to choose a fee-only financial planner like Chicory Wealth:

  1. Shared Goals. With fee-only planning, you know your advisor has your best interests at heart and is working for your success.
  2. No Hidden Fees. What you see is what you get. With Chicory Wealth, that’s a flat fee for financial planning services and a percentage fee for assets under management. Find out more about Chicory Wealth’s fees and services here.
  3. Transparency, Objectivity, and Creativity. Because there are fewer conflicts of interest with fee-only financial planning, advisors are free to be open and supportive and to create a plan truly tailored to their clients’ needs.
  4. Freedom to Leave. If at any point a client is disappointed or wants to leave a financial planning arrangement with a fee-only advisor for any other reason, they are free to do so. There are no surrender charges or similar separation fees.
  5. Professional Support. Fee-only financial advisors are often members of professional organizations such as the National Association of Personal Financial Advisors (NAPFA), which supports financial services delivered in the public interest. Chicory Wealth is a member of NAPFA.


It’s no wonder that people are confused about the distinction between fee-only financial planning and fee-based. They sound very similar (which is no accident). NAPFA defines fee-only this way: “The advisor, or any party in which the advisor has a financial interest, does not receive any compensation or other remuneration that is contingent on any client’s purchase or sale of a financial product. The advisor does not receive a fee or other compensation from another party based on the referral of a client or the client’s business.”

At Chicory Wealth we wholly embrace the fee-only, fiduciary service model because we believe it best serves our clients and it aligns with our mission of helping people create a financial life that is part of the larger tapestry of their life and their dreams for a sustainable future.


For further research, check out this Wall Street Journal article on how to choose a financial planner (which also recommends fee only) and this blog post on distinguishing fee-only from fee-based financial advisors.

And if you’re feeling confused by some of the terms the financial world throws around (financial planner, financial advisor, registered investment advisory, and others), we explain some of those terms right here.


The information, analysis, and opinions expressed herein are for general and educational purposes only. Nothing contained in this commentary is intended to constitute legal, tax, accounting, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type. Chicory Wealth makes no representation regarding the accuracy or completeness of information provided herein. All opinions and views constitute our judgments as of the date of writing and are subject to change at any time without notice.