A fee-based financial advisor charges client fees and can also earn commissions on products they sell, so fee-based is not the same as fee-only.
Fee-based advisors are often dual registered: an investment adviser representative (charging advisory fees) and a registered representative of a broker-dealer (earning commissions). They may charge a fee for a plan and also be paid when a client buys an annuity or insurance policy.
Nothing about the model is improper, but it creates a potential conflict of interest that fee-only advisors avoid. The similar names cause real confusion, so it is worth asking directly: "Do you or your firm receive any compensation from anyone other than me?"
How to check
Search the advisor on FINRA BrokerCheck. A current broker (registered representative) registration means they can earn commissions.
Sources
Related terms
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