You may have typed in any of the following challenges or questions to get to this page:
Is a financial advisor worth it, or am I just paying 1% for nothing?
How much does a financial advisor cost on a few million dollars?
I just inherited money. Can I leave it in an index fund and skip the advisor?
What does a financial advisor actually do for the fee?
Is a fee-only financial advisor better?
Written by Amy Parvaneh, founder and CEO of Select Advisors Institute
Excerpt and Summary:
When money arrives all at once, from an inheritance, a settlement, a divorce or the sale of a family home, one of the first questions people ask is whether a financial advisor is worth the fee. The honest answer: it depends on what you're paying for, and whether you're getting it. Here's how to think through the cost, the value, and the questions that help you decide. If you'd like a neutral second opinion, Select Advisors Institute can help.
The money is suddenly mine. Do I really need to pay someone?
Couldn't I just leave it in the bank until I figure things out?
You could. For a little while, that's not a bad idea at all.
You might have just inherited your mother's accounts and you're still sorting through her mail.
You might have received a divorce settlement and you've never paid a single bill on your own.
You might have gotten a lawsuit settlement or a windfall, and your brother in law already has "a great idea."
You might simply have more money than you ever expected to have, and it makes you nervous instead of happy.
In every one of these cases, the question underneath "is a financial advisor worth it" is really this one:
"Will this person make my life easier and my money safer...or just more expensive?"
And here's a quiet truth: many people who ask "do I need a financial advisor" have already noticed that the money is changing how they sleep, how they talk to family and how they spend their weekends. That's information too.
Let's break it down.
How much does a financial advisor cost, really?
Financial advisor fees come in a few shapes:
Percentage of assets: often around 0.5% to 1% a year, sometimes lower on larger accounts.
Flat fee or retainer: a set annual amount, no matter how big the portfolio.
Hourly or project fee: you pay for a plan or a set of meetings.
Commissions: the advisor earns money from the products you buy.
Here's what most people miss. The advisory fee is often not the whole bill. There can also be fund expenses, outside manager fees and trading costs layered on top.
So when someone says "I charge 1%," your follow up is:
"What is my total cost, all in, in actual dollars per year?"
On $3 million, 1% is $30,000 a year. That's not a small number. It's fair to expect a lot for it.
A few more questions that help you see the full picture:
"Does your fee include financial planning, tax coordination and estate reviews, or are those extra?"
"Is there a lower rate as my assets grow?"
"Will you show me last year's total cost on one page, every year?"
If an advisor can't answer these clearly, that tells you something...and it's not about the markets.
[read about the cost of financial advisors]
So what am I actually paying for?
This is where I can share a little from the inside. Before I started Select Advisors Institute, I spent years at Goldman Sachs Private Wealth Management and then PIMCO. The best advisors I saw were rarely the ones with the flashiest investment ideas.
They were the ones who did the quiet work:
Organizing everything so you know what you own, where it is and who's involved.
Coordinating your team, your CPA, your estate attorney and your insurance agent, so nobody works in a silo.
Keeping you from big mistakes, like selling in a panic, lending money you can't get back, or making a giant decision in the first month.
Planning for the next 20 or 30 years, not just next quarter.
Explaining things in plain English, as many times as you need.
A good advisor's value often shows up in the mistakes you never make.
That's hard to measure on a statement. But anyone who has watched a family lose a big chunk of an inheritance in a few years knows exactly what it's worth.
When is a financial advisor worth it...and when is it not?
It's usually worth it when:
You have significant money and very little experience managing it.
There are moving parts: trusts, inherited retirement accounts, a family home, a business interest, siblings.
You're grieving, stressed or simply busy, and you know you won't keep up with it on your own.
You want someone to say "let's wait" when everyone else says "do something!"
It may not be worth it when:
You're paying a full fee but only hear from your advisor once a year.
The "advice" is mostly a portfolio you could buy yourself, with no planning around it.
You don't understand what you're paying, and nobody has offered to explain.
Bottom line: the question isn't really "is a financial advisor worth it." It's "is this financial advisor worth it, for me?"
Is a fee-only financial advisor better?
I keep reading that fee-only is the "safe" choice. Is that true?
Fee-only means the advisor is paid only by you, not by commissions on products. Many people like that because it removes one big conflict.
But fee-only doesn't automatically mean a good fit. A fee-only advisor can still be too busy for you, a poor communicator, or not experienced with your situation.
This is also where the fiduciary vs financial advisor question comes in. Ask: "Are you a fiduciary at all times, on every account?" You want a simple yes.
And titles can be confusing. A financial advisor, a wealth manager and a private banker can all offer very different levels of service.
[read: Financial Advisor vs Wealth Manager, Which One's Better?]
How do I know if I'm getting my money's worth?
Once you've hired someone, keep asking yourself a few simple questions every year:
Do I understand what I own, and why?
Do I know what I paid last year, in dollars?
Does my advisor talk to my CPA and attorney without me having to chase them?
Do I feel calmer about money than I did before?
When I call, does someone call me back the same day?
If most of those answers are "no," it may be time for a conversation...or a change.
Changing advisors can feel disloyal, especially if the advisor came with your parents' accounts or your marriage. But you're allowed to choose the person who works for you now. A kind, professional "thank you, I'm moving on" is perfectly fine.
And if you haven't hired anyone yet, there's no rush. Many people who are wondering what to do with a windfall or what to do with inheritance money feel pressure to act fast. A few months of thinking, organizing and interviewing usually costs nothing. A rushed decision can cost a lot.
[read: What Is an RIA? Answers for Investors]
The list of questions goes on and on!
And that's exactly where Select Advisors can come in and help!
Don't go through the process of finding or changing a financial advisor alone. We can help!
How can Select Advisors Institute help me decide if a financial advisor is worth it?
At Select Advisors Institute, we do not manage investments or provide financial advice. Instead, we offer strategic support to help you navigate the complexities of wealth management, ensuring that your financial relationships are structured to serve your best interests. By providing these services, we help you maintain control over your financial decisions, ensuring that your wealth management strategy aligns with your unique needs and objectives.
We'd love to speak with you about your goals, answer some of your top questions about the financial industry, and/or refer you to some of my favorite financial advisors in this space that may match your exact needs.
If you've suddenly come into significant money through an inheritance, a settlement or a divorce, you face unique challenges. The fee can feel large, the services can feel vague, and it's hard to know what you're really paying for. An outside perspective can help you understand the true cost, what good service looks like, and whether a particular advisor is earning it.
We provide comprehensive support by assisting in the organization and management of your financial advisor evaluation process. Our services include helping you define your financial needs and priorities before engaging professionals, drafting or reviewing RFPs for advisory and planning services, and building comparison frameworks across firms, services, and compensation models. We also track communications during advisor meetings to identify gaps or follow-ups, ensuring that you have all the necessary information to make informed decisions.
Work with Amy Parvaneh
Since 2014, my firm has guided 100s of financial firms and thousands of financial advisors. I have been in the financial services industry since 2001, with a successful career at Goldman Sachs Private Wealth Management and then PIMCO.
Beyond advisor selection, we assist in gathering background materials and documentation for review, help interpret fee structures and service models, and coordinate introductions to firms that meet your specific criteria. Our team reviews public disclosures, monitors advisor changes or staff turnover that may impact your relationship, and facilitates communication with your legal, tax, and family office teams. We aim to translate industry jargon into terms that align with your values, providing debrief support after advisor interviews and designing internal decision-making frameworks across stakeholders. By serving as a neutral, long-term liaison, we help monitor alignment, organize your existing team for better visibility and clarity, and support onboarding logistics for newly selected firms. Our goal is to ensure that the advisor you choose fits your actual life, not just their presentation.
https://www.linkedin.com/in/amyparvaneh/
If you have any of the below questions, it's time to call us!
Is a financial advisor worth it for someone in my situation?
How much does a financial advisor cost on my level of assets?
What is my total all-in cost, including fund and manager fees?
Am I paying too much for what I'm getting?
What should a financial advisor actually do for their fee?
Is a fee-only financial advisor better for me?
What is the difference between a fee-only and fee-based advisor?
Is my advisor a fiduciary on every account?
Should I pay a percentage, a flat fee or an hourly fee?
Can I negotiate my advisor's fee?
How do I know if my advisor is adding value?
Do I need a financial advisor or a wealth manager?
What should I do with a windfall before hiring anyone?
Can I leave inheritance money in the bank while I decide?
How often should I hear from my advisor?
What if I only hear from my advisor once a year?
Should I keep the advisor I inherited with my parents' accounts?
How do I compare the value of two different advisors?
When is it time to change financial advisors?
Who can give me a neutral second opinion on my advisor?
Select Advisors Institute is not a registered investment adviser and does not provide investment, legal, or tax advice. We are a boutique management consulting firm deeply embedded in the wealth management, asset management, family office, and UHNW sectors, advising financial institutions on strategic growth, talent development, investor communication, and brand positioning, while guiding ultra-high-net-worth families in advisor selection, coordination, and the day-to-day management of complex wealth structures.
Managing the wealth of ultra high net worth investors and family offices is a highly specialized and nuanced endeavor that requires the expertise of seasoned financial advisors. The best financial advisors for UHNW clients possess specialized knowledge, a fiduciary mindset, a customized approach, a robust network, a proven track record, expertise in philanthropic planning, and a sterling reputation. By carefully considering these factors, UHNW individuals and family offices can select financial advisors who are best suited to meet their unique and intricate financial management needs.