So if you sit down with Darryl Jarmosco for some financial advice, he’s not going to sell you anything other than his best professional judgment.
He’ll pitch you no bonds, no CDs, no funds, securities or other investment vehicles.
“Financial planning is a process,” he said.
“Most people see it as a product because that’s how it’s been sold,” added Jarmosco, who opened Jarmosco Financial Planning LLC last fall and is part of a growing push in the financial services industry.
Financial advisers working on a fee-only basis remove the potential for conflicts of interest. Since they work strictly on an hourly fee, they are not tied to trying to sell or steer a client toward a particular investment or money-management product that generates a commission for themselves and their firm.
“I don’t work that way,” he said.
“I’m not here to say ‘Yes! Yes! Yes!’ to somebody and show them a product and they say ‘Yes.’”
And you don’t have to bring the family nest egg with you before he’ll talk to you, either. Fee-only advisers, Jarmosco said, typically don’t require a client to attain or possess a certain asset level before they’ll provide financial advice.
“I can talk to someone who’s 20 and doesn’t have a penny to their name. They just have a goal and they want to get there.
“Or I can talk to people with millions and millions of dollars. I treat them equally, because they both have goals and similarities,” said Jarmosco, a registered investment adviser and certified financial planner whose client base comes largely from middle-income persons.
Driving the interest in fee-only financial advisers and money managers are concerns over conflicts of interest with commission-based brokerage and financial services firms.
Too, consumers are more financially savvy than ever before and are managing their own assets. Many times they are seeking advice to affirm a direction they plan to go or an investment decision that they reached on their own, Jarmosco said.
As a fee-only adviser he said he’s able to best accommodate a situation where price is discussed with the client and settled on up front, and he’s then available as needed.
“They want to be in control. If they want you for one hour a year, that’s up to them. If they want you for 10 hours a year, that’s up to them,” said Jarmosco, who’s a member of The Garrett Financial Network Inc., a nationwide network of independent, fee-only financial advisers.
“Some people just want to validate what they’re doing, and that’s OK,” he added.
For other clients, Jarmosco will help them set a goal, analyze and explain their options, and recommend what to do.
Fee-only operators are not new in the financial services world, said money manager Jay Greer, of Wealth Creation & Preservation LLC in Grand Haven.
The new wrinkle is that they’re moving more into the middle-class market where “average people can afford them,” said Greer. He is a veteran money manager and former stock broker who started his one-man company a year ago.
Greer receives compensation based on how well an investment performs for a client, and not from any commission he receives through the sale of any particular investment product.
A former “commission guy forever” prior to switching and starting his own company, Greer sees fee-only as a purer practice, where every investment decision made on behalf of a client “is ultimately in their best interests.”
“The way my business is now is truly performance-based,” Greer said.