Fee-Only Financial Planner in Colorado Springs
Bonfire Financial is a Fee-Only Financial Planner in Colorado Springs
Bonfire Financial prides itself on being a Fee-Only Financial Planner in Colorado Springs. We are a registered investment advisory firm with a team of CERTIFIED FINANCIAL PLANNERs™. Sounds fancy, right? But what does this all mean?
Fee-Only Financial Planner in Colorado Springs
In short, a fee-only financial planner does not receive commissions, rather compensation comes solely from the fees clients pay for services. In other words, no kickbacks or incentives for recommending certain products.
The fee-only method of compensation is the most transparent and objective method available. This is the number one reason Bonfire Financial uses the fee-only method.
What is a Fee-Only Financial Planner?
Fee-only financial planners are licensed RIAs and CFPs who do not receive commissions on your financial portfolio. Instead, we are financial advisors who charge clients a flat fee.
This is an important concept to understand. Fee-only financial planners are legally bound to never charge a commission or referral fee. Unlike fee-based or commission-based advisors, the team at Bonfire Financial works hard to be completely transparent about any fees you may have.
Why is Fee-Only Financial Planning Important?
Fee-Only financial planning is important because a fee-only structure reduces potential conflicts of interest and ensures that your financial advisor acts as a fiduciary.
Some might assume all financial advisors have a requirement to give advice that is in their client’s best interest, but that’s not always the case. A majority of the financial advice industry operates on a “suitability standard.”
Suitability means a recommendation must be appropriate based on your financial status and goals, but if one product pays the advisor more than another, and both are suitable, the advisor can recommend the product that pays them a higher commission, even if it might not be the best choice for you. Not cool. Yet another reason Bonfire Financial uses the fee-only method.
Fee-only advisors, or fee-only financial planners are legally bound to give advice that is in their client’s best interest.
Should I use a fee-only Financial Advisor?
We sure think so. The best part of working with a fee-only financial planner in Colorado Springs is knowing that they are there to serve your best interests and who wouldn’t want that. Plus, because a fee-only advisor doesn’t get paid more from one product over the other they are free to offer a wider array of solutions to help you reach your goals. On the other hand, commissioned planners tend to limit their suggestions to products that will earn them the most money.
Fee-Only vs Fee-Based
What’s the difference?
Fee-only and fee-based sound remarkably similar, but don’t be fooled, there’s a big difference. Fee-only advisors, as we discussed, are fiduciaries that don’t get paid a commission.
On the other hand, Fee-based advisors are brokers and dealers who do collect fees but can also collect commissions from certain products they often have additional hidden fees. Plus, they aren’t held to the Fiduciary Standard of Care.
For these reasons, not only is Bonfire Financial fee-only but we are CERTIFIED FINANCIAL PLANNERs™. The CFP® certification strengths the benefits of the fee-only model and holds us to a higher standard of excellence for our clients.
FEE-Only, BUT BETTER
Not all advisors are fee-only, and certainly, not all are CFPs®. But also, not all CFPs® are fee-only. Bonfire Financial is both.
In addition to the benefits of fee-only advisors, CERTIFIED FINANCIAL PLANNERs™ offers a higher fiduciary standard, a code of ethics, fitness standards and continuing education.
Currently, the SEC has NO uniform fiduciary standard that applies to all financial professionals who provide personalized investment advice. This means there is no oversight to protect consumers and clients from paying excessive commissions or receiving substandard performance. The CFP® Board has Code and Fiduciary Standards that require CFP® professionals to act in the best interest of the client at all times when providing financial advice. So as a CFP® we are legally required to act in your best interest, all the time.
Further, All CFP® practitioners agree to abide by a strict code of professional conduct, known as CFP® Board’s Code of Ethics and Professional Responsibility, that sets forth ethical responsibilities to the public and clients. This ensures we act with honesty, integrity, competence, diligence, and offer services objectively. It’s a pledge to protect the confidentiality of all client information, avoid or disclose and manage conflicts of interest and always act in the client’s best interests.
The CFP ® Board has also established specific character and fitness standards for the CFP ® certification. This ensures that an individual’s prior conduct would not reflect adversely upon the profession or the CFP ® certification marks. This helps you know that if you hire a CFP ® you won’t find out later that they have a:
- Felony conviction for theft, embezzlement or other financially-based crimes.
- Tax fraud or other tax-related crimes.
- Revocation of a financial license (e.g. registered securities representative, broker/dealer, insurance, investment advisor).
- Felony conviction for any degree of murder or rape.
- Conviction for any other violent crime within the last five years.
- Felony conviction for non-violent crimes (including perjury) within the last five years.
- Personal or business bankruptcies.
Finally, CFP ® professionals are required to complete 3 years of experience related to delivering financial planning services to clients. They also must have a bachelors degree prior to earning the right to be a CFP ®. This real-life experience means that CFP ® professionals have practical financial planning knowledge. They can truly help you create a realistic financial plan that fits your individual needs.
Once certified, CFP ® professionals are required to maintain technical competence and fulfill ethical obligations. Every two years, they must complete a minimum 30 hours of continuing education to stay current with developments in the financial planning profession and better serve clients.
The benefits of working with a Fee-Only Financial Planner
- Fee transparency
- An advisor legally bound to act in your best financial interests (a true fiduciary)
- They are required to disclose any and all potential conflicts of interests
- An advisor bound to the fiduciary standard of client care according to the SEC and CFP® board.
How do I find a fee-only Certified Financial Planner?
If you are looking for a fee-only CERTIFIED FINANCIAL PLANNER™ near you in Colorado Springs, CO then you are in the right place.
At Bonfire Financial we believe that the fee-only system is one that best aligns the needs and goals of our clients with the values of our advisors, and we are proud to be among the minority of fee-only CERTIFIED FINANCIAL PLANNER™ financial advising firms.