Why I moved to being fee based and independent

I’ve worked in the best interest of clients as an accountant for 20+ years and so working with a commission only and proprietary only financial services firm presented a difficult challenge to me. It just didn’t “sync” with how I prefer to operate. It may have been more lucrative to stay where I was in the longer term, but I value transparency and accountability and independence too much. I also don’t work well with sales quotas since I prefer serving over selling. Hence my move to Sterling Mutuals in recent months where I could offer fee based advice without the pressure of offering only in-house product solutions and without the added pressure of sales goals. Sterling Mutuals in an independent network of approximately 300 or so financial advisors. They are located in Windsor Ontario. 

In a commission-only world of financial planning, it’s difficult to access the value and objectivity of the advice given that conflicts of interest can so easily arise. Commissions can vary depending on product and since commissions are “embedded” and paid to an advisor by the mutual fund company so there’s little transparency. I and many others don’t believe that the incentive to promote higher-cost fees aligns best with the interests of clients.

Indeed, being someone who has always placed great importance on a duty of care for clients, I believe that a fee based approach in offering financial advice aligns better with a client first and client best interest approach. That’s how I prefer to do business. Success for my firm is tied to success for clients and not the sale of a particular product.


Here's a summary of the advantages of fee based financial advice for clients, as we see it 

  1. Independence from working for any of the big bank institutions or financial organizations means no proprietary funds.  We also have no sales quotas to meet. This reduces significantly, any real or perceived conflict of interest. 
  2. Fees as compared to commissions are easier to understand and offer greater transparency as well as more frequent reporting. Clients pay their advisor directly as opposed to the advisor being compensated by the investment company. MERs are reduced accordingly.
  3. Fee based services generally provide greater access to a broader selection of products.
  4. Fee based advice reduces the worry about being locked in to a back end commission or deferred sales charge (DSC). 
  5. Fees charged in a fee for service environment are generally tax deductible against income (for non registered accounts) 
  6. Our fees include investment advice, financial planning and regular monitoring as well as legacy listing (ask us what that is) 

Based on the typical fee that we charge, based on a percentage of total assets, we have found that the fee for service model is a more cost effective model for clients. Especially over the long term, fees do matter. Many of the fee based and bank owned wealth management firms with fee based planning, charge as much as 2.5%. That's way too much. We charge 1% which includes a comprehensive financial plan, your personal tax return, regular face-to-face meetings and an online portal with information about your portfolios in real time. 

Please connect to learn more about how we do things differently. And as always, we are happy to do offer a comparison review of your present portfolio.