Fee-Based VS Commission-Based Financial Services
Private Asset Advisory Group is a fee-based advisory firm. We believe that financial advisement works best when the advisor isn’t motivated by the commission they can make off of your account, but by your financial success. Our advisors provide hands-on portfolio management. They are authorized by you to make investments and move your money around so that it is best serving you at all times rather than wait for you to call and ask about changing your investment strategy or selling a certain stock in favor of another. Our advisors initiate regular meetings with our clients to ensure that we are always up-to-date on your financial goals, changes in your life that might affect your risk tolerance, and most importantly, to ensure that you understand how your portfolio is set up.
For our clients, fee-based advisory services are generally much more cost-effective than commission-based brokerage services due to the size of their portfolios. Wondering if fee-based financial management is right for you? Take a look at the differences between the two in the chart below.
Fee-Based | Commission-Based | |
Communication | Authorized proactive account management, meaning we can move your money to help maximize your investments without calling you about every little change | You have to authorize every purchase, even if it is only $2 for a stock and you have to initiate it the majority of the time |
Regular meetings often initiated by us to review your financial goals, assess our portfolio | Infrequent meetings which often have to be requested by you | |
Regular performance reports that are specific to your investment goals | Standardized reports on how each investment did over a period of 3 months, 6 months, and/or a year | |
Fees | Fees are directly proportional to the services that are provided to you paid as a flat fee or as a percentage of assets under management | Fees are taken as a commission for the purchase of each individual stock or bond, which is only cost effective if you are investing small amounts of money with them |
Fees for account management are potentially tax deductible, talk to your accountant for more information | Paid commissions are not tax deductible | |
Investment Options | Wide range of investment opportunities that will fit your financial goals and provide you with options to achieve the best portfolio for you | Exchange-traded investments including stock, bonds, mutual funds, etc. and limited private placement products that can limit your ability to achieve all of your financial goals and achieve the best portfolio for you. |
Minimum investment level | No minimum investment level |