Q: Is there is a fair percentage to charge to manage accounts that come to between $400,000-$500,000? I had taken a class about retiring and took the instructor up on a free consult. After he looked at my Roth and 401(k) he said if I went with him the yearly fee would be 1.5 percent. I now have a planner that is the type trying to sell me products, and I know that, but would like to go with someone that has my best interest at heart. - Becky 

A: Here’s the good news: The financial planning market is moving in a direction that should benefit customers. I want to highlight two major trends.

First, adviser fees are coming under pressure. One factor has been the rise of robo-advisers, firms that combine the basic ideas of modern portfolio theory with low-cost index funds and automated technology to create diversified portfolios at a low cost. Even more important is the recent growth in low-fee hybrid models that offer customers a combination of personally tailored financial advice and with low-fee investment management.

For example, the financial services firm Charles Schwab has announced its Schwab Intelligent Advisor. The product has certified financial planners that offer comprehensive financial planning accompanied with low-fee investment management. The cost is 28 basis points for accounts with a minimum of $25,000. (There are additional fees for the underlying investments, but the total fee structure is still low.) The mutual fund behemoth Vanguard has its hybrid Personal Advisor Service at 30 basis points. Compare that to the typical adviser fee for assets-under-management of 1 percent for portfolios under $1 million (which means the 1.5 percent rate you were quoted is high).

The hybrid model will work well for most people except truly high-net-worth households and individuals. The bottom line to your question: A 1.5 percent fee for a portfolio of some $500,000 is steep.

Second, customers are embracing the new fiduciary standard, which requires advisers to put the client’s interest first with retirement savings, eliminate conflicts of interest and promote transparency. Much of the business has been held to the less rigorous “suitability” standard, which only requires disclosing conflicts of interest. The fiduciary rule is a step in the right direction.

More people will now ask a potential adviser, “Are you held to the fiduciary standard?” If the answer is no, they will take their business elsewhere. 

Chris Farrell is senior economics contributor, “Marketplace,” commentator, Minnesota Public Radio.