What Does a 1% Advisor Fee Actually Pay For? A Checklist, Plus What 39 SEC Brochures Say

Advisable Finance · Last updated October 2, 2026

Educational only. Not investment, tax, or legal advice. This article explains how to tell what an advisory fee covers, using public SEC filings. It does not say whether any fee, firm, or service is right for you. The firms described below were drawn at random from SEC data. We don't name them. We describe them only by size and region, and we summarize their fee and service language from their own brochures as examples of how that language varies. Nothing here is an endorsement or a criticism of any firm. Fees in brochures are often maximums or ranges, are frequently negotiable, and can change. A listing on Advisable Finance is not an endorsement. Confirm current fees and services in each firm's own filings and agreement before you act.

Direct answer

A 1% fee on your assets pays for managing (or advising on) those investments. Whether it also pays for financial planning depends on the firm, and the firm's Form ADV brochure says which. In SEC data dated Sept. 1, 2026, about 1 in 4 firms that charge a percentage of assets and serve everyday clients don't report offering financial planning at all. Among firms that do, many also charge for planning on its own.

The argument behind this post

A recent post on X (Sept. 29, 2026) criticized paying a 'wealth advisor' 1% or more of your assets every year for a portfolio that mostly tracks the S&P 500. As of Oct. 2 it had about 150 likes and about 30 replies, and the replies split the usual way:

• The do-it-yourself side: index funds plus automatic investing is enough, and a yearly percentage adds up over decades.
• The pro-advice side: most people don't stay disciplined on their own, and tax, estate, and withdrawal planning can be worth paying for.
• The middle: 1% for an index mix is hard to justify, but 1% for real planning work is a different product.

We're not going to settle that here. The post itself ended on the useful part: if you're getting an index-like portfolio anyway, "you better understand exactly what you're paying for." That's a question you can answer from public filings, and this guide shows how.

What does a 1% fee actually cover?

Two different jobs often get billed as one fee.

• Investment management. Choosing investments, placing trades, rebalancing back to a target mix, and monitoring the account. This is the core of what a percentage-of-assets fee pays for. It's what the percentage is calculated on.
• Financial planning. Work on the rest of your money life: taxes, retirement income, estate coordination, insurance, cash flow, and big decisions. Some firms fold this into the same percentage. Some charge for it separately. Some don't offer it.

The percentage looks the same either way. What's inside it doesn't.

How many firms that charge on assets offer financial planning?

Every SEC-registered advisory firm reports on Form ADV Part 1A how it is paid (Item 5.E), which services it offers (Item 5.G), and, if it offers financial planning, how many clients it provided planning to in its last fiscal year (Item 5.H).

We counted those answers in the SEC's file dated Sept. 1, 2026 (17,149 firms). We focused on the 9,784 firms that report at least some individual clients who are not high net worth, the closest match to an everyday household. Of those, 9,544 (97.5%) charge a percentage of assets under management.

Among those 9,544 firms:

So at roughly 1 in 4 of these firms, the services list on Form ADV doesn't include financial planning. That doesn't mean they never talk about taxes or retirement. It does mean planning isn't something they report offering as a service.

Planning often has its own price tag. Of the 7,300 firms that charge on assets and offer planning, 6,196 (84.9%) also report charging fixed fees or hourly fees somewhere in their business. Those boxes are firm-wide, so they don't prove your planning is billed separately. They do show that many firms have a way to price planning on its own.

Planning reaches fewer clients than the firm serves. We compared each firm's planning-client count (Item 5.H, reported in ranges) with its number of individual clients (Item 5.D). We used the top of each range, which if anything overstates how many clients get planning. Of the 7,246 firms that charge on assets, offer planning, and have at least 10 individual clients:

• 4,606 (63.6%) reported providing financial planning to fewer than half as many clients as they have individual clients.
• 1,440 (19.9%) reported providing planning to zero clients in their last fiscal year, even though they list it as a service.

What this data does not show: what you pay, what your account includes, or the quality of anyone's advice. Firms fill in Form ADV themselves and may define "financial planning" narrowly, for example as a written plan delivered that year. A client who got a plan two years ago may not be counted. The data covers SEC-registered firms only. Smaller, state-registered advisors aren't in this file.

(Source: SEC, Information About Registered Investment Advisers and Exempt Reporting Advisers, file dated Sept. 1, 2026, Items 5.D, 5.E, 5.G and 5.H. Checked Oct. 2, 2026.)

Is financial planning included in the fee? What 39 brochures say

Checkboxes only go so far. The detail is in each firm's brochure (Form ADV Part 2A), where Item 4 describes services and Item 5 describes fees.

We drew 40 firms at random from the 9,544 above and pulled each one's current brochure from the SEC's IAPD site on Oct. 1, 2026. One firm had only its Form CRS posted, which left 39 brochures. For each, we asked one question: for a client paying the asset-based fee, what does the brochure say about financial planning?

This is a small sample, so treat the shares as rough. Sorting brochures into groups also takes judgment: two separate reads of all 39 agreed on 36 of them, including all six in the "included" group, and the table uses the second read. The sample lines up with the bigger SEC data, though: 10 of the 39 firms (26%) don't check the planning box on Part 1A, close to the 23.5% across all 9,544. (Of those 10, one still says planning is included with its asset management, and one describes planning-type work without calling it financial planning.)

The pattern that matters for the X debate: in this sample, only 6 of 39 brochures (about 15%) say plainly that planning comes with the asset-based fee. For most, you'd need to ask, or read closely, to know whether your 1% includes it.

Same $10,000, different jobs: six real fee schedules

Here is what six of those brochures say, with the fee on a $1 million account worked out from each firm's posted schedule. We don't name the firms. Size is the firm's total assets under management as reported to the SEC.

Math: Firm E, $250,000 × 1.50% + $250,000 × 1.25% + $500,000 × 1.00% = $3,750 + $3,125 + $5,000 = $11,875. Firm F, $1,000,000 × 0.85% = $8,500. The others, $1,000,000 × 1.00% = $10,000. Posted schedules only. Five of the six brochures say fees can be negotiated or may vary. Firm F's says its fees are not negotiable, though it may quote a different schedule in some situations, and it lists a minimum annual fee per household, which it may reduce or waive.

Four of the six land at $10,000 a year on $1 million, and all six fall between $8,500 and $11,875. At one firm that buys a concentrated stock portfolio and no planning. At others it buys portfolio management, with planning available for an extra fee. At others, planning is part of the deal. None of these is automatically the better value. They're different products sold at a similar price, which is why the percentage alone can't settle whether 1% is "worth it."

A few other things from the sample worth knowing about:

• Planning can depend on your balance. At Firm G, a small firm in the South, the asset-based fee covers planning only once a client's managed assets pass $250,000. Below that, planning means a separate agreement and a separate fee.
• "Included" can have limits. Firm H, a mid-size firm on the West Coast, says planning for its investment clients is generally covered by the asset-based fee, but it can charge extra hourly fees when a client's planning needs are more complex.
• The rate itself can move with planning. Firm I, a mid-size firm in New England, says its asset-based fee typically ranges from 0.25% to 1.5%, and one factor is whether ongoing financial planning is part of the arrangement.

How much does financial planning cost on its own?

Many firms in the sample list a price for planning by itself: 27 of the 39 brochures give at least one dollar figure. That gives you a reference point. If your brochure says planning is separate, this is roughly what it costs at firms like these.

Ranges are wide because firms price by complexity, so use them as a sense of scale, not a quote.

Two more things planning usually is not:

• Not tax prep. Firm J, a small firm, says its planning does not include preparing income, gift, or estate tax returns, or legal documents such as wills or trusts. Firm I sells tax preparation and planning as a separately priced tax service.
• Not legal work. Firm C says its representatives are not attorneys or accountants and don't draft wills, trusts, or other estate documents. Advisors can coordinate with your attorney. Drafting a will or trust is the attorney's job.

The checklist: what is your 1% buying?

Use this with your current advisor or one you're considering. The first two rows are investment management, the core of what an asset-based fee pays for. The rest is planning, which may or may not be in the fee.

Then score it simply:

• Mostly investment management: the brochure prices planning separately or doesn't offer it, reviews are about the account only, and you can't name a planning deliverable you've received.
• Investment management plus planning: the brochure says planning is included, you get a written plan or regular planning reviews, and the firm works on taxes, income, or estate coordination with you.

Neither answer makes a fee good or bad. It tells you what you're comparing.

How can you check what a firm's fee includes?

1. Start with the firm's reported services and fee types. Search an advisor's name, a firm name, or your ZIP code on Advisable. Each advisor profile shows the firm's "Advisory services offered by the firm" (for example, Financial Planning or Portfolio management) and "Fee types reported by the firm" (for example, a percentage of assets, hourly, or fixed fees). Under Advanced filters you can narrow a search by service and by fee structure. These are firm-wide answers, not proof of what your account includes.

2. Open the official record. On the same Advisable profile, use the link to the firm's official SEC record, or search the firm yourself on the SEC's free Investment Adviser Public Disclosure site. Open the firm's Part 2A brochure.

3. Read Item 4, then Item 5. Item 4 describes the advisory services the firm offers. Item 5 gives the fee schedule and says whether fees are negotiable. In the PDF, search for "financial planning," "included," "separate," "in addition to," and "no additional." Those words usually tell you within a minute which bucket the firm is in. Our walkthrough for reading fees on Form ADV covers the rest of Item 5.

4. Check Item 13. It says whether the firm reviews accounts or financial plans, how often, and what reports you get.

5. Read Form CRS. This short summary has a required section titled "What investment services and advice can you provide me?" It must say whether the firm monitors your investments and whether that's part of its standard services. Find it on IAPD or at Investor.gov/CRS.

6. Get the service list in writing. Your advisory agreement is what actually applies to you. Ask the firm to list what your fee includes and what costs extra.

Turn the percentage into dollars first

It's easier to judge what you're getting when you know what you're paying. Multiply your balance by the rate, using the firm's schedule if it has tiers.

$600,000 × 1% = $6,000 a year, or $1,500 a quarter if billed quarterly.

Then ask: what do I get for $6,000 a year? If the answer is a managed portfolio, that's one thing to compare. If it's a managed portfolio plus a written plan, tax work, and a spending strategy, that's another. Fund expenses and account fees usually come on top. We covered how 1% compounds over time, and how it compares with a retirement withdrawal, in When your advisor says "wait," ask how they get paid.

Questions to ask before you pay (or keep paying) 1%

1. "Which of these services are included in my fee, and which cost extra?" (Bring the checklist.)
2. "Is financial planning included for my account, or only above a certain balance?"
3. "What did you do for me last year besides managing the portfolio?"
4. "Do you offer planning on its own, for a flat or hourly fee? What would that cost?"
5. "Will my portfolio be mostly index funds? If so, what does your fee add?"
6. "Is the fee negotiable, and does it drop at higher balances?"

Form CRS gives you two more worth asking word for word: "Given my financial situation, should I choose an investment advisory service? Why or why not?" and "How will you choose investments to recommend to me?"

Is a 1% fee worth it?

It depends on what's inside it and whether you use it. The filings show that "1%" isn't one product. At some firms it covers a managed portfolio and nothing else. At others it covers that plus ongoing planning. The fair comparison isn't 1% versus 0%. It's what this firm does for this fee versus what you'd otherwise do yourself or pay for separately. The checklist above is a way to make that comparison with facts from the firm's own documents.

There are other ways to buy each piece. If what you mainly want is portfolio management, Investor.gov notes that robo-advisors, automated digital advisory programs, "often seek to offer investment advice for lower costs and fees than traditional advisory programs," though their services vary widely. If what you mainly want is planning, many firms sell it on its own, as the price table above shows. Each format has its own trade-offs and conflicts.

How Advisable fits

Advisable is a free directory of SEC-registered investment advisors. You can search by name or ZIP code and filter by services, assets under management, and fee types. Profiles show a firm's reported services, fee types, AUM, and client count, with links to the firm's official SEC record (IAPD). Advisors can claim their profile for free. Advisable does not show fee percentages, brochure text, or whether planning is included in an asset-based fee. Use Advisable to build a short list, then read each firm's brochure on IAPD.

Related guides

• How to read an advisor's fees on Form ADV
• Fee-only vs fee-based vs commission
• When your advisor says "wait," ask how they get paid
• What is a wrap fee program?
• How much money do you need for a financial advisor?

FAQ

What does a 1% financial advisor fee usually cover?

It covers managing or advising on your investments: choosing them, trading, rebalancing, and monitoring. Whether it also covers financial planning varies by firm. In a random sample of 39 SEC brochures, about 15% said planning is included in the asset-based fee, roughly 28% said it's included only in some cases, and roughly 31% described it only as a separately priced service.

Is a 1% advisor fee worth it?

It depends on what the fee includes and whether you need it. A 1% fee that buys only portfolio management is a different product from a 1% fee that also buys tax, retirement-income, and estate planning. Read the firm's brochure (Form ADV Part 2A, Items 4 and 5) to see which you're getting.

Is financial planning included in an AUM fee?

Sometimes. About 23.5% of SEC-registered firms that charge on assets and serve everyday clients don't report offering financial planning at all (SEC data dated Sept. 1, 2026). Among those that do, some include it, some include it above an asset level or for "basic" planning only, and some charge separately.

What's the difference between investment management and financial planning?

Investment management is running the portfolio. Financial planning covers the rest: taxes, retirement income, estate coordination, insurance, cash flow, and major decisions. Some advisors do both under one fee. Others sell them separately.

Does a 1% fee include tax preparation or estate documents?

Usually not. Tax planning and tax preparation are different services, and some brochures say plainly that their planning doesn't include preparing tax returns or legal documents such as wills or trusts. Some firms sell tax preparation separately. Ask before you assume.

How much does financial planning cost on its own?

In the 39 brochures we reviewed, 21 list an hourly rate for planning, from $100 to $1,000 an hour, and most firms' top rate falls between $200 and $500. Of the 18 that give an upper limit for a one-time or fixed-fee plan, 14 top out between $5,000 and $25,000. Prices depend on complexity and change over time.

Where can I see what services an advisor's fee includes?

In the firm's Form ADV Part 2A brochure: Item 4 for services, Item 5 for fees, Item 13 for reviews. The firm's Form CRS summarizes services under "What investment services and advice can you provide me?" Both are free on IAPD.

Does Advisable show whether planning is included in a firm's fee?

No. Advisable shows each firm's reported services and fee types and links to the firm on IAPD. Whether planning is included in the asset-based fee is in the firm's brochure and your agreement.

Sources (accessed Oct 1 to 2, 2026)

1. X post that started the argument (posted Sept. 29, 2026, 9:45 PM ET; engagement re-checked via the X API on Oct. 2, 2026): x.com/StonkChris/status/2105111801503285579
2. SEC: Information About Registered Investment Advisers and Exempt Reporting Advisers (file dated Sept. 1, 2026; counts computed by Advisable)
3. SEC: Form ADV Part 1A (Item 5.D client types, 5.E compensation, 5.G services, 5.H financial planning clients)
4. SEC: Form ADV Part 2 instructions (Part 2A Item 4 Advisory Business, Item 5 Fees and Compensation, Item 13 Review of Accounts)
5. SEC: Form CRS instructions (Item 2, "What investment services and advice can you provide me?", monitoring, conversation starters)
6. SEC: Investment Adviser Public Disclosure (IAPD) · Investor.gov: Form CRS search
7. Investor.gov: Robo-Adviser (glossary)
8. Form ADV Part 2A brochures for 39 randomly sampled SEC-registered firms, as posted on IAPD on Oct. 1, 2026. Firms are not named in this article. The source list and coding are kept on file.

Method note

We drew 40 firms at random (fixed seed) from the 9,544 SEC-registered firms in the Sept. 1, 2026 file that charge a percentage of assets and report individual clients who are not high net worth. We downloaded each firm's current Form ADV Part 2A from IAPD on Oct. 1, 2026. One firm had only Form CRS posted, leaving 39. Each brochure was coded into one of five groups based on what it says about financial planning for clients paying the asset-based fee, and the coding was then redone independently. The coding reflects brochure language only, not what any client actually receives. Firms are described by size band (total regulatory assets under management reported to the SEC) and region only. Checked Oct. 2, 2026. For the planning-client comparison we used the top of each Item 5.H range (for firms reporting more than 500, the reported number plus 250, because the form rounds to the nearest 500) and counted 'fewer than 5' clients as 4.

Educational reminder: This page is not investment advice. Verify fees and disclosures on official sources before making decisions.