How is Wealth Management Advice Paid?


Retrocession on entry fees, and annual fees for products sold, billing of advisory fees in complex cases. The sources of compensation for wealth management advisor are varied.

A wealth management advisor who works liberally is logically paid for the work he does.

However, its remuneration is, in reality, not always billed directly to customers. The regulations also provide for more visibility for the saver on costs.

The turnover of independent wealth management advisers consists of retrocessions on the financial and real estate products they distribute. It may be all or part of the entry fee retained (one time), such as taking out a life insurance policy or a program property for tax exemption.

Mainly Retrocessions

But above all, these are retrocessions from annual management fees levied on financial products sold, which constitute the most significant and recurring part of their remuneration.

wealth management advisor

Usually housed through life insurance, these retrocessions come on the one hand from the insurance company, which pays the wealth management advisor part of the contract’s annual management costs.

And on the other hand, portfolio management companies, when units of account, have been selected in the contract’s financial allocation. In this case, they also pay part of the annual management fees charged by their funds.

It is then easy to understand that the risk is to see the advisor directing you too massively towards the investment solutions that generate the most turnover for his company.

Final Words

The remainder of his remuneration, which is very small or even non-existent in some wealth management firms, is made up of consulting fees billed directly to clients when their assets situation, financial situation, and complexity of their asset issues so require. In this type of situation, the advisor must justify a certain level of expertise.

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