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Edited by The cost of hiring a financial planner varies depending on the services offered and how those services are billed. Financial planners may charge by the hour, by project, through ongoing subscription fees, or as a percentage of assets under management. According to the 2024 Kitces Report, median fees range from $300 per hour to $3,000 for a standalone plan, with annual subscriptions averaging $4,500. Many advisors also include planning services within a 1% AUM fee. Understanding financial planner cost structures can help assess which model fits your financial situation.
If you need help finding financial advice, this free tool can connect you with fiduciary financial advisors who serve your area.
What Does a Financial Planner Do?
A financial planner assesses the client’s full financial situation and then develops a plan based on a goal. This can be as broad as saving for retirement or developing an investment plan, or as narrow as paying down a specific amount of debt, or setting up a college fund. The financial planner reviews all of the client’s assets and debts and creates a money management plan.
Many of the most qualified financial planners hold the Certified Financial Planner™ (CFP®) designation. To earn this credential, individuals must complete extensive coursework, pass a comprehensive exam, gain thousands of hours of relevant experience and commit to a code of ethics. CFP® professionals are also required to complete 30 hours of continuing education every two years to stay up to date in the field.
Although the terms “financial planner” and “financial advisor” are sometimes used interchangeably, they’re not always synonymous. Under the SEC’s Regulation Best Interest (Reg BI), professionals calling themselves financial advisors must be registered as investment advisors. A financial planner typically provides a written plan and holistic financial guidance and often serves in a fiduciary capacity.
A person may hold themselves out as a “financial planner”—offering help with budgeting, goal-setting or general financial wellness—but not provide investment advice or manage client assets.
If a planner is not registered as an IAR or associated with a registered investment advisor (RIA), they are not legally permitted to provide investment advice for compensation under the Investment Advisers Act of 1940. As a result, under Reg BI and SEC guidance, they should not call themselves a “financial advisor” unless they are properly registered and the title does not mislead clients into thinking they are receiving fiduciary-level investment advice.
What Types of Fees Do Financial Planners Charge?
The cost of a financial planner varies so much because there are several different ways planners collect payment. Each structure has trade-offs depending on how often you need advice and whether you want investment management included. Understanding these fee structures can help clarify what kind of relationship you’re entering with a planner.
Hourly Fees
Under this model, the planner bills a set rate for each hour of work. Clients typically use hourly planners for limited-scope projects or one-time advice sessions. This structure offers flexibility and is often used by those who don’t require ongoing support.
Flat Fees
Flat-fee planners charge a predetermined amount for a specific service, such as a comprehensive financial plan or a retirement analysis. This approach allows clients to understand the total cost upfront and is generally used for clearly defined deliverables.
Asset-Based Fees
In this arrangement, planners charge a percentage of the client’s assets under management (AUM), typically deducted quarterly. In this model, the planner’s compensation grows alongside the client’s portfolio and is often bundled with ongoing investment management.
Other Forms of Compensation
Some planners offer an annual retainer or subscription model, providing ongoing financial planning support for a recurring fee. This structure appeals to clients who want consistent access to advice without asset management.
Although less common among financial planners, some may receive commissions for selling financial products like insurance or mutual funds. This model can create potential conflicts of interest, which is why many fiduciary planners avoid it.
How Much Does a Financial Planner Cost?
The cost of working with a financial planner depends on how services are priced and delivered. Broadly, fees fall into four categories: flat fees for one-time plans, asset-based fees for ongoing management, hourly rates and subscription fees. Each structure reflects a different service model and level of client engagement.
| Fee Model | Median Fee (2024) |
|---|---|
| AUM-Based (including financial plan) | 1% |
| Hourly Fee | $300 |
| Standalone/Project-Based | $3,000 per plan |
| Subscription (retainer) | $4,500 per year |
AUM Fees
AUM fees are the most common way advisors charge for ongoing services, with 92% of advisory teams utilizing them, and 86% identifying AUM as their primary revenue source. One percent of AUM is an industry-standard asset-based fee.
However, a significant portion of advisors offering financial planning services do so without charging a separate fee, effectively including it within the AUM fee, according to the 2024 Kitces Report, “How Financial Planners Actually Do Financial Planning.” (The Kitces analysis is based on survey responses from 621 financial advisors.) Advisors who bundle fees often provide ongoing financial planning support as part of their investment management relationship.
Fixed or Project-Based Fees
For a standalone financial plan, Kitces found the median cost to be approximately $3,000, with more comprehensive plans priced higher. The top 10% of plans start at $5,200 or more. However, a quarter of standalone plans are $2,000 or less.
These fees cover detailed, up-front planning work such as retirement projections, tax analysis or estate planning strategies. Some planners discount or waive this fee for clients who also invest assets with them.
Hourly Rates
Some planners offer services on an hourly basis, which is most suitable for clients seeking specific guidance without committing to a full plan or ongoing relationship. According to Kitces, typical hourly rates range from $250 to $350, though this can vary based on the advisor’s credentials and the complexity of the work. The median hourly charge in 2024 was $300.
Subscription Fees
Monthly subscription models, also known as retainer fees, provide ongoing access to financial advice for a flat annual fee. Kitces Research shows that fewer than one in 10 advisors rely on a subscription fee as their primary source of revenue, making them less common. The median subscription fee in 2024 was $4,500 per year.
Can You Get a Financial Plan for Free?
While comprehensive financial plans typically involve fees, some advisors may offer complimentary or low-cost options under certain circumstances. For instance, advisors might provide a free initial consultation or a simplified plan as part of their prospecting efforts. According to Kitces, 11% of planners offer plans at no cost. Instead, they use them “as a marketing tool to deliver to prospects in the hopes that they become a client.”
Additionally, some firms may waive planning fees for clients who meet specific asset thresholds or who engage in ongoing investment management services. In fact, only 17% of firms that use both AUM and separate planning fees end up charging clients both. “Most advisors use planning fees to shore up revenue for lower-AUM clients rather than as a strategy to expand revenue per client for all clients served,” the Kitces Report notes.
Bottom Line
Financial planning can be delivered in a variety of ways, and pricing tends to reflect the structure and scope of the relationship. Whether financial planners charge hourly, annually or as a percentage of assets, there’s a wide spectrum of models designed to accommodate different levels of complexity and client preference. While some planners still charge separately for written plans, many now bundle that work into other services, especially for clients with investment assets.
Tips for Finding a Financial Advisor
- Before finding and choosing a advisor, clearly define what you want assistance with—be it retirement planning, debt management, investment strategies or estate planning. Identifying your specific needs will help you find an advisor whose expertise aligns with your financial objectives. For instance, if you’re focused on retirement, look for advisors who specialize in that area.
- Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
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