Advisor Insight

Do you really know how much you pay your financial advisor?

Paying for financial advice
Paying for financial advice

So you've decided—wisely—that it's time you hired a professional to manage your hard-earned income and savings. But just how do you pick the right financial advisor for your needs, goals and temperament—and be ensured that he or she really has your best interests at heart?

One way to measure a financial advisor's trustworthiness is to be fully clear on how they are being paid for their services.

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In this video segment, Sharon Epperson, CNBC's senior personal finance correspondent, explains the different ways advisors opt to be compensated—whether it's through commissions, a fee-only basis or some combination of the two—so investors can avoid overpaying for services.

Weighing in on the discussion are CNBC Financial Advisor Council members Grant Rawdin of Wescott Financial, Zaneilia Harris of Harris and Harris Wealth, and Manisha Thakor of Buckingham and The BAM Alliance.

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Panel members also explain, in plain English, the difference between the often confusing fiduciary vs. suitability standards of financial advisor care.