What is a Fee-Only Financial Advisor?
Fee-only financial advisors are compensated exclusively by fees paid directly by their clients. They do not receive commissions, kickbacks, or any other compensation from financial product providers. This model eliminates conflicts of interest and ensures advice is truly independent.
The Fee-Only Difference
When an advisor's income depends solely on client fees rather than product commissions, they have a fiduciary duty to act in your best interest—not to sell you products that generate the highest commissions.
Fiduciary Standard
Fee-only advisors must put your interests ahead of their own, legally and ethically. They cannot recommend products based on commission potential.
Fee-Only vs Fee-Based Financial Advisors: What's the Difference?
Many Singaporeans searching for a fee-based financial advisor or fixed fee financial advisor are actually looking for fee-only advisors. Here's the key distinction:
Fee-Only Advisors
- • 100% compensated by client fees
- • Zero commissions from any source
- • Strongest conflict-free advice
- • Full fiduciary duty
Fee-Based Advisors
- • Charge client fees (hourly or fixed fee)
- • May also receive product commissions
- • More transparent than commission-only
- • Potential for some conflicts
Our recommendation
Whether you're looking for a fee-only or fee-based advisor in Singapore, prioritise advisors who are transparent about their compensation and are MAS-licensed. A fixed fee financial advisor who clearly discloses all income sources is preferable to one with hidden commissions.
Fee-Only vs Commission-Based: Complete Comparison
| Feature | Fee-Only | Commission-Based |
|---|---|---|
| How They're Paid | Client fees only | Product commissions |
| Conflicts of Interest | None ✓ | Potential ⚠️ |
| Cost Transparency | High - clear fees ✓ | Low - hidden in products |
| Product Range | All products ✓ | Commission products only |
| Upfront Cost | Visible & immediate | "Free" consultation ✓ |
| Total Cost (5 years) | Often lower ✓ | Often higher |
| Best For | Complex planning, HNW clients | Simple needs, small portfolios |
Fee-Only Pricing Models in Singapore
Hourly Rate
$200-500/hourPay only for the time you use. Typical sessions: 1-3 hours for simple questions, 5-10 hours for comprehensive financial planning.
Best for: One-time advice, specific questions, young professionals
Example: $250/hour × 6 hours = $1,500 for full financial plan
Fixed Project Fee
$2,000-10,000One-time fee for specific deliverable like comprehensive financial plan, retirement analysis, or estate planning strategy.
Best for: Major life transitions, specific projects, one-time planning
Example: $5,000 for complete retirement planning package
Assets Under Management (AUM)
0.5-1.5% annuallyAnnual percentage of your invested assets. Includes ongoing portfolio management, rebalancing, and financial planning.
Best for: Ongoing management, high-net-worth, complex portfolios
Example: 1% × $500,000 = $5,000/year
Retainer/Subscription
$200-800/monthMonthly or quarterly fee for ongoing access to advisor. Includes regular reviews, unlimited questions, and continuous planning.
Best for: Ongoing support, regular check-ins, evolving situations
Example: $400/month = $4,800/year
Real Cost Comparison: Fee-Only vs Commission
Scenario: $200,000 Investment Portfolio Over 5 Years
Fee-Only Advisor
- • Initial plan: $3,000 (one-time)
- • Annual AUM fee: 1% = $2,000/year
- • Investment products: Low-cost ETFs (0.1% ER)
- Total 5-year cost: $13,000
Commission-Based Advisor
- • Initial consultation: "Free"
- • Upfront commission: 3% = $6,000 (hidden)
- • Trail commission: 0.5%/year = $1,000/year
- • Product costs: Unit trusts (1.5% ER)
- Total 5-year cost: $21,000+
Savings with Fee-Only: $8,000+ over 5 years
Plus better investment options and unbiased advice throughout the relationship.
When Should You Choose a Fee-Only Advisor?
✓ Fee-Only is Best When:
- • You have $200,000+ in investable assets
- • You need comprehensive financial planning
- • You want complete transparency in costs
- • You have complex financial situations
- • You want access to all investment options
- • You value unbiased, objective advice
- • You prefer ongoing relationship vs transaction
✗ Commission Might Work When:
- • You have limited assets ($50,000 or less)
- • You need simple insurance products only
- • You can't afford upfront fees
- • You have straightforward needs
- • You want one-time product purchase
- • You're comfortable with potential conflicts
- • You don't need ongoing advice
Questions to Ask a Fee-Only Advisor
1. How exactly are you compensated?
Verify they receive ZERO commissions. Ask: "Do you receive any compensation from product providers?" The answer should be "No."
2. What is your exact fee structure?
Get it in writing. Ask for examples: "What would I pay for a $300,000 portfolio?"
3. Do you have a fiduciary duty?
Fee-only advisors should always act as fiduciaries. Get this in writing.
4. What services are included in your fee?
Clarify: Number of meetings, plan updates, investment management, tax planning, etc.
5. How do you select investment products?
Should be based on cost-effectiveness and suitability, not commission potential.
Related Financial Planning Guides
MAS Licensed Financial Advisors
Verify licensing and find regulated advisors in Singapore
CPF Optimization Strategies
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Singapore Investment Guide
Start investing in Singapore with confidence
Financial Planning FAQs
Common questions about financial advisors answered
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