A fee-only financial advisor typically costs 0.50% to 1.25% of the assets they manage per year, $200 to $400 per hour for targeted questions, or $2,000 to $7,000 for a one-time comprehensive financial plan. Ongoing retainer arrangements usually run $2,500 to $9,000 a year. Where you land inside those ranges depends on which pricing model you choose, how complicated your financial life is, and how much of the advisor’s time you actually need.
Because fee-only advisors accept no commissions or third-party compensation, the fee you pay is the only money they make from working with you. That changes both the incentives and the math compared with a fee-based advisor who may also earn commissions on insurance, annuities, or certain mutual funds. Fee-only advisors operate as fiduciaries under the Investment Advisers Act of 1940, meaning they are legally required to act in your best interest.1Securities and Exchange Commission. Commission Interpretation Regarding Standard of Conduct for Investment Advisers The trade-off is that you pay the full cost of advice out of pocket.
The Four Pricing Models and What Each Costs
Assets Under Management
The most common model charges a percentage of the investment accounts the advisor oversees, usually deducted quarterly straight from your account. The industry average sits near 1% per year. Rates run from about 0.50% for large, low-maintenance portfolios up to 1.25% or more for smaller accounts that take more hands-on work.
Most firms use tiered pricing, called breakpoints. Instead of a flat rate on every dollar, lower rates apply as your balance crosses thresholds. A firm might charge 1.10% on the first $500,000, 0.85% on the next $500,000, and 0.65% on anything above $1 million. Your blended rate drops as the portfolio grows.
What people miss about AUM pricing is how quietly the dollar amount grows. A 1% fee on a $300,000 portfolio is $3,000 a year. The same 1% on $1.2 million is $12,000. If the advisor’s workload hasn’t quadrupled with your balance, you’re paying significantly more for roughly the same service. That is exactly when negotiation, or a switch to a different model, becomes worth the conversation.
Hourly
Hourly billing typically runs $200 to $400. Lower rates tend to come from less-credentialed planners or lower-cost markets; rates above $400 are common for specialists working on complex tax or estate situations. You pay only for the time you use, which fits a focused question well: reviewing an equity compensation package, running numbers on a Roth conversion, or getting a second opinion on an allocation.
The limitation is scope creep. A single tax question that turns into a three-hour deep dive into your whole financial picture will show up on the bill as three hours.
Flat Fee or Project
A flat-fee arrangement sets a price upfront for a defined piece of work. The most common project is a comprehensive financial plan covering retirement projections, cash flow, debt payoff, insurance, and investment allocation. These run $2,000 to $7,000, with the high end reserved for households with business ownership, stock options, or multi-state tax exposure.
You know the total cost going in and walk away with a document you can implement yourself. The limitation is that a plan is a snapshot. If you want yearly updates without full-time management, many advisors offer annual plan reviews for $500 to $2,000 depending on complexity.
Retainer or Subscription
Retainers charge a recurring flat fee, usually monthly or quarterly, for continuous access. Annual costs typically fall between $2,500 and $9,000, scaled to the scope of services and your complexity. Your bill stays the same whether your portfolio rises 20% or falls 15%.
This model suits high-income professionals who earn well but haven’t built a large investment portfolio yet, because an AUM fee on a modest balance isn’t enough to sustain a real planning relationship. Retainer clients typically get regular check-ins, proactive recommendations when tax laws or life circumstances change, and access to the advisor between scheduled meetings.
What You Pay on Top of the Advisory Fee
The number on the fee schedule is not the total cost of having your money managed. Several other expenses layer on top.
- Fund expense ratios. Every mutual fund and ETF charges an internal annual fee. Low-cost index funds run 0.03% to 0.10%. Actively managed funds can charge 0.50% to 1.00% or more.
- Custodian or platform fees. Your investments are held by a custodian such as Schwab, Fidelity, or Pershing. Some charge nothing for custody; others charge 0.10% to 0.15% of assets annually and pass the cost through.
- Trading and transaction costs. Most major custodians have eliminated commissions on stock and ETF trades, but transaction fees on certain mutual funds still apply and can add up in an actively traded account.
Ask any prospective advisor for an all-in cost estimate that includes their fee, expected fund expense ratios, and custodian charges. A 1% AUM fee combined with a 0.25% average fund expense ratio puts your real cost near 1.25% annually. On a $500,000 portfolio, that’s the gap between $5,000 and $6,250 a year.
What Pushes Your Price Up or Down
Two clients with similar portfolio sizes often pay very different fees. A few things explain most of the spread.
Financial complexity is the biggest driver. A single W-2 earner with a 401(k) and a savings account is straightforward work. A household with rental properties, stock options vesting on staggered schedules, a small business, and cross-border tax obligations takes dramatically more expertise and time. Advisors price for complexity because getting those situations wrong has real consequences.
Credentials move the number too. An advisor holding the Certified Financial Planner designation has completed education, examination, and ethics requirements that go beyond basic licensing.2CFP Board. Code of Ethics and Standards of Conduct Specialists in retirement income planning or divorce financial analysis command premium rates in their areas, and industry data suggests credentialed advisors earn roughly 13% more than those without designations.
Geography plays a smaller role. An advisor in Manhattan or San Francisco carries higher office costs than one in a midsize city, and those costs find their way into client fees. Virtual planning has made it easy to hire an advisor in a lower-cost market even if you live in an expensive one.
Account minimums are the other access question. About two-thirds of AUM-based advisors require a minimum account size, with $100,000 a common threshold and some firms setting the floor at $250,000, $500,000, or $1 million. If your investable assets fall below the minimum, AUM planning may not be available at the firms you’d otherwise consider. Hourly, flat-fee, and retainer models sidestep this entirely, because the advisor’s compensation isn’t tied to how much you have invested. NAPFA and the Garrett Planning Network maintain directories of fee-only advisors who specifically serve clients below traditional minimums.
How to Verify the Fee Before You Sign
Every registered investment advisor files Form ADV with the SEC or their state regulator. Part 2A, sometimes called the firm brochure, includes a section (Item 5) that spells out exactly how the firm charges, what the fee schedule looks like, and whether those fees are negotiable.3U.S. Securities and Exchange Commission. Form ADV Part 2 Uniform Requirements for the Investment Adviser Brochure and Brochure Supplements It also discloses conflicts of interest and disciplinary history.
You can pull any advisor’s Form ADV for free through the SEC’s Investment Adviser Public Disclosure database at adviserinfo.sec.gov.4Securities and Exchange Commission. IAPD – Investment Adviser Public Disclosure Read Item 5 before your first meeting. If the fee structure described in the ADV doesn’t match what the advisor tells you in person, walk away.
Firms must update this filing annually and whenever their fee structure or conflict disclosures change materially.3U.S. Securities and Exchange Commission. Form ADV Part 2 Uniform Requirements for the Investment Adviser Brochure and Brochure Supplements A years-old filing with no amendments tells you something about how carefully the firm handles compliance.
Negotiating the Number Down
Advisory fees are more negotiable than most people realize. Form ADV Part 2A requires firms to disclose whether their fees are negotiable, and many say yes. Knowing this before you walk in gives you standing to ask.
The strongest lever is total household assets. If a spouse, parents, or adult children also invest with the same firm, ask for householding, which aggregates all family accounts when calculating breakpoints. A family with three accounts totaling $1.5 million should pay the rate for $1.5 million, not three separate rates on each account.
Other leverage points: being a long-term client, referring other clients, and having a portfolio that doesn’t need frequent rebalancing. Advisors will sometimes shave a quarter of a percentage point or more off accounts that take less maintenance. The worst answer you’ll get is no.
Robo-Advisors as a Price Benchmark
If the ranges above feel steep, robo-advisors give you a useful floor. Automated platforms charge a median fee near 0.25% of assets per year, and some charge no advisory fee at all, making their money through cash sweep programs or premium tiers. You get algorithmic portfolio management, automatic rebalancing, and tax-loss harvesting. You don’t get a human who understands your full financial picture.
A robo is often enough for someone with straightforward finances who mainly needs disciplined investing. The human advisor earns the higher fee in situations where the answer isn’t obvious from a formula: deciding whether to exercise stock options before an IPO, structuring retirement withdrawals to minimize lifetime taxes, or coordinating decisions during a divorce. The gap between 0.25% and 1.00% matters on a large balance, so the real question is whether the human advice is worth roughly four times the price for your situation.