How much does a financial advisor cost?

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If you’re seeking professional financial guidance, you’re probably wondering how much a financial advisor costs. Their costs can vary greatly, so it’s important to know how financial advisors make their money.

How much does a financial advisor cost?

The costs of a financial advisor can differ greatly depending on their fee structures.

Some financial advisors charge annual assets under management (AUM) fees, which range from 0.5% to 2% on average⁽¹⁾. So if a financial advisor manages $20,000 of your assets and charges a 0.50% AUM fee, your financial advisory costs would be $100 a year.

Some robo-advisors like Fidelity Go charge no advisory fees until your assets reach a certain level. Others, like SoFi Automated Investing and Titan Invest, charge no fees whatsoever to automatically manage your portfolio. Robo-advisors are digital platforms that build and manage investment portfolios based on factors like your financial goals, risk tolerance and time horizon.

On the other hand, some financial planners — a type of financial advisor — may charge hourly or flat fees for tailoring financial plans that meet specific goals like budgeting, saving for emergencies and retirement planning. These depend largely on the complexity of your needs. But typical hourly fees can range from $120 to $300, while fixed plan fees can stretch from $1,000 to $3,000⁽²⁾.

Our top picks for financial advisors

How do financial advisors make money?

Financial advisors may implement a variety of fee structures. Here are some examples:

• Hourly fee. Some financial advisors charge per hour of advice.
• Flat fee. An advisor may charge a fixed fee for a specific service.
• Commission-based fee. In addition to other advisory fees, some advisors charge commission-based fees tied to the products they sell or recommend.
• AUM fee. These fees are based on how much money the advisor manages for you. In general, these fees decrease as the value of your assets increases.
• Performance-based fee. Some advisors charge annual performance-based fees in addition to AUM fees if assets grow above a certain benchmark, like the S&P 500. The fee is typically based on a percentage of asset growth over the benchmark’s growth.

Typical financial advisor fees

The average financial advisor fee depends on several variables, but here’s a look into average costs depending on different fee structures.

Fee type	Typical cost
AUM	0.5%—2%
Hourly fee	$120—$300
Fixed fee	$1,000—$3,000
Commissions	3%–6%(3)

Human advisor vs. robo-advisor

Automated advisory services, more commonly known as robo-advisors, are growing in popularity because they offer portfolio construction and management services at a fraction of the cost of a human investment advisor. Whereas a traditional financial advisor may charge you a 1% advisory fee, most robo-advisors charge an advisory fee of 0.25% or less.

The downside to automated portfolio advice and management is that they aren’t fully tailored to the individual. While a robo-advisor may offer lower fees and minimums, it can’t navigate the nuances of complex financial situations the way a human advisor could. If you’re looking for an inexpensive, hands-off investing approach, consider a robo-advisor. If you need assistance beyond portfolio management, including tax help and planning services, consider a human advisor.

Dive deeper: Robo-advisors vs financial advisors: How they compare

What to look for in a financial advisor

When seeking professional advice, consider the following:

• Ask if they’re fiduciaries. Financial advisors who are fiduciaries are legally obligated to provide advice solely in your best interest.
• Check credentials. Look for registrations and licenses with the Securities and Exchange Commission (SEC) and the Financial Industry Regulatory Authority (FINRA), especially if you’re looking for investment advice.
• Find the right type of advisor. advisors may specialize is different areas, so find an advisor who specializes in the area where you need help. For instance, if you’re seeking a tailored financial plan, consider a certified financial planner (CFP).

Are financial advisors worth it?

If you feel you need professional guidance in managing your finances, you may want to consider a financial advisor. But be sure to ask yourself what kind of services you need and research financial advisors to understand their experience, credentials and fees.

Bottom line

Financial advisor costs can vary immensely depending on their fee structures and the services you seek. Compare different fees against your needs to see which advisor is right for you.

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Frequently asked questions

How much does a Fidelity financial advisor cost?

Fidelity offers several advisory services, including its digital advisory services, Fidelity Go and Fidelity Managed FidFolios, as well as a phone-based advisor and a dedicated advisor. The Fidelity Go robo-advisor charges an advisory fee ranging from 0% to 35%, depending on account size, while Fidelity Managed FidFolios comes with a 0.70% advisory fee. The advisory fee for Fidelity’s wealth management services ranges from 0.50% to 1.50%, while its private wealth management services come with a 0.20% to 1.04% advisory fee.

What is the typical fee for a financial advisor?

Financial advisor fees vary depending on fee structures. For example, the typical AUM fee ranges from 0.5% to 2%, and a financial planning hourly fee usually ranges from $120 to $300.

Is it worth paying a financial advisor?

If you need professional guidance in managing your finances and you find one that can help you reach your goals, the fee could be worth it.

How much money should you have to see a financial advisor?

You may consider a financial advisor if you have at least $50,000 in investable assets. But even people with far less can find a financial advisor and fee structure that meets their needs.⁽⁴⁾

How much do financial advisors charge?

Many financial advisors charge fees as a percentage of AUM, which typically ranges from 0.5% to 2%. But fees can vary greatly depending on fee structure and the services you need.