What does assets under management fee mean?

Question

The advisors I am comparing charge in very different ways. One quotes a percentage of the assets they manage, while others use hourly fees, commissions, or products with their own expenses. What does an assets under management fee actually pay for, and how can I compare it with the other costs?

Soradin · Accepted Answer

It is a recurring charge based on the value of assets the advisor manages, usually calculated as a percentage. Within the broader financial plan, financial professionals may charge a percentage of assets, a flat fee, an hourly fee, a subscription, commissions, or a combination. Before money is committed, the written plan should show the cash flow impact, time horizon, tax effects, liquidity needs, and downside risk.

What does assets under management fee mean?

Soradin

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