No. of Recommendations: 0
This doesn't make much sense to me, at least from someone who was just defending commission-based situations. What's the difference for paying a 1% commission from a commission-based broker that averages to $500 on any given year, and paying a $500 annual fee for advice... answer: nothing. Except you know the annual fee guy won't try to trade you in and out of stocks to make himself money.
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If a client has the money in a wrap account and then pays a 2% fee, and doesn't pay "commissions" on in and out trading then the fixed rate fee is actually his incentive to get better returns because of the growth in principal equals growth in fee.
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