What do “fee-only” and what are key conflicts of interest to avoid?

Consumers of financial services should understand the business model of the firms they choose. “Fee-only” means a fully-transparent fee schedule, stated in advance, and paid only by the client to eliminate or manage any potential conflicts-of-interest. “Fee-based” or “commission based” means that an investment provider receives payment from product companies for placing their clients into those financial products, which is a conflict of interest because that commission could (and often does) influence the decision of the financial provider. For people with accounts under $1,000,000 it has traditionally been a challenge to find fee-only advisors. Certain on-line advisory firms such as WealthStep are helping to solve that problem, by providing fee-only, unbiased advice.