Marching Toward Fees

August 2003
Journal of Financial Planning;Aug2003, Vol. 16 Issue 8, p18
Academic Journal
The article highlights findings of a report from Boston, Massachusetts-based consulting firm Cerulli Associates regarding the shift from commission-based to fee-based financial planning. More than 75 percent of broker/dealer reps expect to increase the percentage of revenues they derive from fees and over half of them already earn more than 50 percent of their revenue from fees. Of financial advisors currently earning zero to ten percent of their revenue from fees, 38 percent expect to be fee-based by 2008 and 43 percent expect a fee/commission mix. 80 percent of broker/dealer reps who have adopted fees reported that the switch had a significant impact on the depth of their client relationships. Of planners who have made the transition to predominately fees, 50 percent experienced a serious decline in income, and 67 percent of wirehouse advisors found substantial client resistance.


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