More than half of consumers prefer to pay a flat fee for financial planning services, according to a new report.
LIMRA published this finding in a summary of results from two surveys of consumers, including “Bye-Bye Commissions” and “Use of and Impact of Advisors,” both published this year.
The report reveals that 55 percent of consumers prefer to pay an advisor a flat fee to develop and implement a plan for retirement income. This compares to 13 percent of consumers who prefer to pay an annual fee and 9 percent of consumers who prefer to pay a commission.
Similarly high percentages of consumers say they prefer to pay an advisor a flat fee to develop and maintain a financial plan (55 percent), secure advice on insurance types, amounts and options (58 percent) and get advice on types of investment options to buy and sell (54 percent).
A greater preference for flat fees, LIMRA reports, extends to the purchase of insurance and investment products. Nearly seven in 10 consumers surveyed say they would prefer to pay a flat fee when buying life and health insurance (68 percent), plus auto and homeowner’s insurance (67 percent). Nearly six in 10 respondents indicate a preference for a flat fee when buying or selling stocks and bonds (58 percent) or buying and selling mutual funds (57 percent).