|By Richard Burnett, The Orlando Sentinel, Fla.|
"At this stage, I'm comfortable doing it on my own," the
It has long been the view from
But in the wake of the 2007-09 recession, with shrunken portfolios to manage, more advisers have begun offering financial advice that's more affordable and accessible. With an approaching wave of baby-boomer retirees, more financial planners are offering pay-by-the-hour sessions geared toward those of modest means, the "semi-affluent," in addition to the percentage-of-funds-under-management pay scale used with wealthy clients.
That approach had drawn a lot of interest but not nearly as much follow-through, planners in
"You have an increasing number of certified financial planners offering hourly service; and you have more people looking into it, especially baby boomers who are now thinking retirement," said
"You have all those things coming together over the last decade," he said. "But I'll have to say I have received very little new business from the hourly side. There's still this sense out there that people who work with financial planners have to be rich. And that is just not the case."
In some ways, the financial-advisory business has helped create the impression that only the rich need apply. Many planners became "wealth managers," requiring clients to have a minimum of
She received comprehensive advice that involved, among other things, re-balancing her 403b retirement plan to reduce her exposure to riskier stocks, and updating her estate planning. The process took less than three hours and the cost — about
"I wanted to make sure I used a financial planner that I knew wouldn't be biased and just selling me his own products," she said. "For me, in the end, it was kind of like a confirmation of some things I was already doing. But he definitely fine-tuned the direction where I was going."
Even pay-by-the-hour services — which may charge from
Some may balk at paying such fees for financial help, even when it comes from experts who are supposed to be unbiased sources of advice, such as certified financial planners, or CFPs. (Note: CFPs and registered investment advisors, or RIAs, are required by fiduciary rules to always put the best interests of their clients first, ahead of their potential compensation. Different ethics rules apply to stockbrokers and insurance-sales agents.)
The hourly-fee business has been slow to develop, said
Many middle-class investors are still wary of the persistently turbulent stock market, said Carbonaro, and some are still dealing with fallout from the recession, such as personal debt, employment uncertainty and other issues. A few potential customers come in hoping that the financial advice will be free, she said, much like the help offered by non-profit consumer-credit counseling services.
As a result, Carbonaro said, she sees only a few hourly-fee clients a month.
"A lot of people want to get professional financial help, but they are often scared, don't know what they don't know, and don't know what questions to ask," she said. "But they do know they don't want to pay a fee. They don't understand that it is just like they would pay a lawyer or any other professional."
With huge numbers of middle-class baby boomers approaching retirement in
"I don't know why more people haven't responded. I think maybe they don't understand the real value of it. They hesitate to pay
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