Daily News: Mike Desepoli

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How to know what you’re really paying your financial advisor

Mike Desepoli, Daily News Contributor

March 1, 2016

Looking for a financial advisor? Wondering how you’ll pay him or her — and just how much?

There are three types of advisers you can work with. The first will charge you commission; the second, a management fee on the assets handled; and the third, a hybrid of the first two approaches. But all might also charge you hidden fees.

When you’re working with a financial adviser — regardless of what type of adviser they are — it is important to understand not only how they’re being compensated, but what are the fees that aren’t so transparent.

Many advisers themselves don’t understand all the hidden fees and expenses associated with asset management.

So how can you be sure what you are paying?

Ask!

Any adviser with a transparent business model will be happy to explain all costs incurred in any investment program. After all, shouldn’t you know exactly what you are paying for?

Some good questions to ask include:

How will you get paid for investments you recommend?

Will you be paid commissions on investments or other products you sell?

Do you receive payments from mutual funds or investment companies you recommend?

Aside from what I pay you, what other costs will I incur?

It is extremely important for investors to do their homework when choosing a financial adviser. Advisers should be able to directly answer your questions and have detailed, documented proof of fees and fiduciary standards.

One of the most important responsibilities of an adviser is to ensure that fees are both reasonable, and clearly communicated to the client.

If your adviser isn’t holding up their end of the bargain, it may be time to shop around.

Take control of how your investments are being managed and the expenses that you’re paying. It is your right to have access to transparent information about your account.

About Mike Desepoli

As a financial advisor and accredited investment fiduciary for Heritage Financial Advisory Group, Mike Desepoli serves as a wealth management resource to business owners and executives, assisting them in making proactive, personal financial decisions. Mike’s vision is to help clients live for today, as well as plan for tomorrow. He believes in making the complicated simple, by educating his clients so they can feel more confident about the decisions they make regarding their financial health.

To view more of Mike’s work for The Daily News, you can visit them on the web at http://www.nydailynews.com/authors?author=Mike-Desepoli