By Daniel Korleski, MBA
Being a fee-only Registered Investment Advisor, we take joy in delivering top-notch service to our clients by crafting personalized wealth management strategies for each individual and their family. As independent advisors and fiduciaries, we prioritize our clients’ best interests, providing tailored advice aligned with their specific needs and goals.
If you’re thinking about seeking financial guidance from an experienced professional, below we have outlined the different types of compensation for financial advisors and highlighted some reasons why an independent advisor could be the ideal partner to assist you in creating and upholding a successful financial plan for you and your family.
Compensation Structure for Financial Advisors
Financial advisors typically fall into one of three categories: fee-only financial advisors, fee-based financial advisors, and commission-based financial advisors. As the name suggests, fee-only financial advisors are compensated through a predetermined fee, while commission-based and fee-based financial advisors are compensated at least partly through commissions earned from the selling of certain products and through certain financial transactions.
There is also a distinct difference between a fee-only financial advisor and a fee-based financial advisor. Fee-only financial advisors receive their compensation from fees paid from the client to the advisor. Additionally, fee-only advisors have traditionally been held to a fiduciary duty to protect their clients’ interests before their own.
Fiduciary duty sounds like a good thing, but what exactly does it mean? Simply put, a financial advisor who has a fiduciary duty to his client has a legal responsibility to put the interests of his client before his own. This means that if your financial advisor is a fiduciary, he must act solely in your best interests or face legal consequences. A fiduciary must live up to clients’ trust in them through transparency and minimizing conflicts of interest.
Fee-based financial advisors are generally compensated by both commissions on the sale of certain products and fees for their advice, which typically includes guidance on which financial product the client should buy from them. Some critics have noted that both fee-based and commission-based financial advisors have an inherent conflict of interest because these types of financial advisors work on commission and are predisposed to promote products from which they will benefit financially.
The Benefits of Working With an Independent Financial Advisor
Personalized, Unbiased Advice
As independent advisors, the guidance we offer our clients is objective and unbiased because we are not tied to any particular financial company or investment firm. We analyze your complete financial picture, gain an understanding of your life circumstances, dreams, and concerns, and provide advice that fits you. We don’t recommend products to meet quotas. As such, our mission is to help you achieve the best life possible with the money you have.
Fee Transparency
Typically, independent wealth advisors operate on a compensation model that is fee-only. This is important because we are not beholden to recommend products that will benefit us financially in any way. “How are you compensated?” should be a question everyone asks their financial advisor.
At Cobalt Private Wealth, we are fee-only, and we do not earn money from any type of kickback or commission for recommending certain securities or investments. With us, you don’t have to wonder what you’re paying or worry about those inherent conflicts of interest.
Relationships Are Our Priority
At Cobalt Private Wealth, each team member takes pride in understanding our clients’ unique needs and fostering personal connections with them. We provide tailored advice that aligns with your goals and stay updated on any life changes that might impact your financial strategy. Our dynamic financial plan evolves with your life, prioritizing what you need at each step of the journey.
With trust and respect at our core, we carry a deep commitment to our clients’ financial well-being. As fiduciary advisors, clients rely on us as a dedicated ally looking out for their best interests. If you believe Cobalt Private Wealth could be the right partner for your financial journey, reach out to me at danielkorleski@cobaltprivatewealth.com or 719-332-3863 to schedule a meeting and learn about the benefits of an independent fee-only financial advisor.
About Dan
Daniel Korleski is the President & CEO for Cobalt Private Wealth, where he helps his clients grow, manage, and protect their wealth so they can work toward a stronger financial future. With over 30 years of experience in the financial services industry, Dan has served as the managing director for Investment Trust Company, chief investment officer for the Wealth Management Group at American National Bank in Denver, and regional investment manager for the Greater Colorado Region of the Private Bank at Wells Fargo, where he oversaw the management of over $2 billion. In 2008, he was appointed by the mayor of Colorado Springs to the City’s Investment Advisory Committee. Dan holds an MBA in investment management from Midwestern State University in Wichita Falls, Texas, a Bachelor of Science in Finance from Florida State University, and is a member of both the CFA Society Colorado and The Financial Planning Association.
Dan loves to give of his time to his community and is currently serving as the Board Chair of Catholic Charities of Central Colorado and oversees the Homebound Ministry at St. Paul Catholic Church. He has also served as Chair of the Board of Trustees of Pikes Peak Hospice Foundation, President of the Broadmoor Rotary Club, and Vice President of the Board for the Pikes Peak Chapter of Trout Unlimited. Dan was born and raised in Spain and is fluent in Spanish. To learn more about Dan, connect with him on LinkedIn.
