Wealth Management Fees – How Much Do Advisors Cost in 2025? (And Why I Think It’s Too Much for Too Little)

It’s a fair question. In fact, it’s often the first thing people want to understand before they commit to any kind of professional guidance, whether that’s asset management fees, portfolio management fees, or broader investment management fees.

Many start by searching things like “financial advisor fees”, “how much do financial advisors charge”, or “financial advisor cost Canada,” which don’t get me wrong, is an important consideration. However, what most people really want to understand when it comes to cost is: are the fees that I am paying going to eat into my retirement and jeopardize my future, while the returns end up being subpar at the same time?

There is an important distinction that needs to be made when understanding the responsibilities of the person that you’re working with. Under current regulations, a financial advisor is typically required to facilitate the sale of investment products that meet the risk-tolerance requirements of the client. This is an important role; however, there are many components to someone’s financial life that are being ignored if this is looked at in isolation.

This is what has led the industry to shift more toward “wealth management,” a term flaunted around so casually that it often lacks the appreciation of how important and how complex the matter truly is. Selling products that fit the client’s risk of tolerance simply isn’t enough. What’s truly needed is a broader plan that supports long-term wealth and deeper tax-efficient planning within the context of life goals.

The challenge is that most firms don’t clearly explain what you actually receive for these costs. Even options marketed as fee-only wealth management can vary dramatically in terms of value and transparency.

Here’s my opinion: most clients are paying too much and getting too little.

 

The Problem with Industry Fees

If you walk into a Canadian bank today, chances are you’ll be steered into one of their proprietary mutual funds.

The average cost? Around 2–2.5% of your assets every single year. According to research published by NerdWallet, most traditional financial advisors charge between 0.5% and 2% depending on account size and service model, meaning many Canadians unknowingly sit at the top end of the cost spectrum.

What do you get for that fee? For many clients:

An index fund that could be purchased for free (or nearly free) elsewhere

Little to no proactive planning around tax, estate, insurance, or corporate structure

An advisor you rarely, if ever, hear from

In other words: you’re paying premium fees for bargain-bin service.

Worse, many of these funds are “locked in.” That means that if you want to move your money, you often have to sell first — triggering taxes and delays.

On top of that, the fees themselves aren’t always transparent. Morningstar’s global fee study has consistently shown that Canada has some of the highest mutual fund MERs in the world, often exceeding 2%, and these costs are rarely explained clearly to clients.

It’s an expensive, inefficient system.

 

Why This Matters for Professionals

For incorporated professionals, such as lawyers, doctors, consultants, business owners, the stakes are even higher.

You’re not just investing personally. Your corporation, tax planning, and estate goals are all intertwined.

Yet too often, investment advice is delivered in a silo. You get recommendations on a portfolio, but no guidance on how it fits with your corporate accounts, your tax strategy, or your broader life goals.

That fragmented approach leads to:

Overpaid taxes

Missed planning opportunities

Underwhelming returns on both money and peace of mind

I believe fees should be justified by real value.

 

Approach360™ — A Different Standard

That’s why I built Approach360™, a comprehensive financial strategy designed for incorporated professionals earning $200K–$1M+.

Instead of just charging you to sit in a mutual fund, we:

Align your financial strategy with your personal values and vision for life

Optimize your corporate and personal structures for tax efficiency

Oversee your investments in the context of your full financial plan

Coordinate with legal, insurance, and accounting partners to protect your wealth

Handle the financial admin so you don’t have to

One relationship. Every financial decision covered. That’s what your fees should pay for.

Fee Breakdown & Data of Common Fee Types

To make meaningful fee comparisons, here’s a breakdown of the most common pricing models across the industry:

 

Fee Type	Description	Typical Range (2025)
AUM (Assets Under Management)	Percentage charged on total assets managed	0.5% – 2% annually
Flat Planning Fee	One-time or annual fee for a full financial plan	$1,500 – $7,500+
Hourly Fee	Pay only for advice hours used	$150 – $500/hour
Retainer / Subscription	Ongoing access to planning + support	$2,000 – $12,000/year
Commission-Based	Advisor is compensated through commissions on products sold	Varies; often hidden via MERs

 

All-In Cost Explanation

Many Canadians pay both the advisor fee AND the mutual fund MER (often 1.5%–2%), meaning the true cost is much higher than advertised.

 

Hidden Fees to Watch For

Trading commissions

Deferred sales charges

Fund management expenses (MERs)

Trailer commissions paid to advisors

 

Examples & Scenarios

Here’s what fees look like at different portfolio sizes under AUM pricing:

$100K portfolio → 1% fee = $1,000/year

$500K portfolio → 1% fee = $5,000/year

$1M portfolio → 1% fee = $10,000/year

$2M portfolio → 1% fee = $20,000/year

$5M portfolio → 1% fee = $50,000/year

 

Long-Term Impact of Fees

A 1% fee compounded over 25 years can reduce your final wealth by hundreds of thousands, sometimes more than $500,000 depending on returns.

 

Comparison Example

Investment Type	Typical All-In Cost	Pros	Cons
Bank Mutual Fund	~2.0–2.5%+ annually	Easy to buy, advisor included	High fees, low transparency, poor tax efficiency
ETF Portfolio	~0.25–0.40% annually	Low cost, diversified, transparent	No planning, no tax strategy, DIY risk
Discretionary Portfolio Manager	~0.80–1.20% annually	Professional management, planning integration, tax coordination	Fees vary by firm; quality differs widely

 

Service Breakdown

Service Category	Typical Financial Advisor	Portfolio / Wealth Manager
Investment Authority	Suggests products; client must approve trades	Discretionary management (executes decisions on behalf of client)
Compensation Model	Often commission-based or fee-based	Typically transparent, fee-only or AUM-based
Investment Oversight	Periodic check-ins (often annually)	Ongoing monitoring & proactive adjustments
Tax Strategy Integration	Limited or none	Deep integration with tax planning & structure
Corporate Planning	Rarely included	Included for incorporated professionals
Estate & Insurance Coordination	Basic referrals	Full coordination with your advisors
Planning Depth	Product-focused	Holistic, integrated, long-term strategy
Who It Fits	General public, beginners	High-income professionals, complex needs

 

Transparency & Conflicts of Interest

Fee-only = paid only by the client, avoiding product bias

Fee-based = combination of fees and commissions

Commission-based = compensated for selling products

 

Why Conflicts Matter

Bank advisors often recommend in-house funds because they are compensated for doing so, not because it’s best for the client.

 

Red Flags When Choosing an Advisor

Unclear or hidden fees

No written financial plan

Compensation tied to product sales

Infrequent communication

 

How to Reduce Your Fees Without Reducing Quality

Avoid high-MER mutual funds

Consider ETF-based portfolios

Work with fee-only or transparent portfolio managers

Consolidate accounts to lower tiered AUM brackets

 

 

Conclusion

The reality is simple: fees matter — but value matters more. Paying for true planning, oversight, and strategic integration is worthwhile. Paying for a product and a once-a-year phone call is not.

If you’re an incorporated professional in Canada, and you want a clearer understanding of what you’re paying — and what you should be getting — Approach360™ was built for you.

Book a clarity call and let’s make every dollar you earn work harder for your future.

 

Common Questions (FAQ)

1. What is a reasonable fee in 2025?

A reasonable fee depends on the level of service you’re receiving. In Canada:

0.8%–1.2% is typical for discretionary portfolio management

1.5%–2.5% is common for bank mutual funds (often without planning)

Flat fees for planning range $1,500–$7,500+

A reasonable fee is one that aligns with true value: integrated tax planning, investment oversight, and ongoing financial strategy — not simply product access.

2. What do advisors actually do for their fee?

It varies dramatically by advisor type.
Typical financial advisors:

Recommend investment products

Evaluate risk tolerance

Meet annually or occasionally

Portfolio/wealth managers:

Manage investments directly (discretionary authority)

Provide ongoing oversight

Integrate tax, estate, corporate, and retirement planning

Align planning with long-term goals

Coordinate with accountants and lawyers

If all you’re receiving is a product recommendation and a yearly check-in, you’re likely overpaying.

3. Are financial advisor fees tax deductible in Canada?

Not always. Here’s the breakdown:

Fees paid for investment management (AUM fees) may be tax deductible in some corporate or business contexts.

Fees embedded inside mutual funds (MERs) are not deductible.

Financial planning fees may be deductible for businesses or corporations, not typically for individuals.

Incorporated professionals often have more opportunities for fee deductibility — when the structure is set up properly.

4. How do I know if I’m overpaying?

You are likely overpaying if:

You hold bank mutual funds with MERs above 1.5%

You’re charged a fee but receive no tax planning

You rarely hear from your advisor

You don’t have a written financial plan

Your portfolio underperforms benchmarks after fees

High fees are only justified when they come with deep planning, proactive oversight, and strategic integration.

5. Should I choose percentage fees or flat fees?

Both can work — depending on your needs:

Percentage fees (AUM) make sense when you want ongoing management and planning.

Flat fees work well if you only need a standalone financial plan.

Hourly fees are best for one-time advice.

Professionals with complex corporate structures usually benefit most from integrated AUM-based wealth management.

6. What is a typical wealth management fee?

In Canada:

0.8%–1.2% for discretionary portfolio managers

1.5%–2.5% for bank-managed mutual funds

0.25%–0.40% for ETF-based solutions (no planning)

The key is understanding what you get for the fee — not just the number.

7. Is a 1% financial advisor fee worth it?

It depends.
A 1% fee is worth it when it includes:

Tax planning

Retirement structure optimization

Corporate integration

Estate considerations

Ongoing investment oversight

It is not worth it when it only includes a mutual fund and a yearly review.

8. Is $500,000 enough to work with a financial advisor?

Yes. Many portfolio managers accept clients starting around $250K–$500K.
For incorporated professionals, complexity often matters more than asset size — corporations, holding companies, and multi-account structures can justify advanced planning even with smaller portfolios.

9. Is a 1% management fee acceptable for financial advice?

Yes — if you receive full value.
A 1% fee is acceptable when it includes:

Active oversight

Coordinated tax strategy

Corporate + personal planning

Advisor accessibility

Performance reporting and transparency

A 1% fee is not acceptable when paired with high-MER mutual funds or minimal service.