A Fee-Only Advisor refers to a financial advisor who is compensated solely through direct fees paid by their clients, rather than through commissions or other forms of indirect compensation. This type of advisor typically charges a flat rate, an hourly rate, or a percentage of the assets under management (AUM) for their services.

Key characteristics of fee-only advisors in the IRA industry include:

Fiduciary Responsibility: Fee-only advisors are often held to a fiduciary standard, meaning they are legally required to act in their client’s best interests, providing unbiased and conflict-free advice.
Transparency: Since their compensation comes directly from their clients, fee-only advisors usually provide greater transparency in terms of costs and fees. This allows clients to understand exactly what they are paying for and why.
No Commission-Based Products: Unlike commission-based advisors, fee-only advisors do not earn commissions from selling specific financial products. This can minimize potential conflicts of interest and encourages advisors to recommend investments that are in the best interest of the client, rather than those that would yield the highest commission.
Focus on Comprehensive Financial Planning: Fee-only advisors often emphasize comprehensive financial planning, considering all aspects of a client’s financial situation, including retirement planning, tax strategies, estate planning, and investment management.
Client-Centric Approach: They typically work more closely with clients to understand their financial goals, risk tolerance, and other personal factors that influence investment and retirement planning.

In the context of IRAs, a fee-only advisor can help clients with strategies for retirement savings, investment choices within the IRA, tax implications, and retirement income planning. The aim is to provide guidance that aligns with the client’s long-term retirement goals and financial well-being.