FFR 290 – Who Pays Your Financial Advisor?

Learn the questions to ask when choosing a financial advisor! Selecting a financial partner is an important decision. In this Financial Flash Report, Kristine discusses key considerations and questions to explore when evaluating financial advisory firms.

Stiles Financial Services is an independent, fee-based registered investment advisor. And as a fiduciary, we manage client portfolios directly, selecting individual securities based on each client’s personalized goals and risk tolerance. Watch to learn more about the evaluation process and the questions to ask before working with a financial advisory firm. Subscribe for weekly financial education content.

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Financial Flash #290 – Who Pays Your Financial Advisor?

Hi everyone, and welcome to this week’s Financial Flash. I’m Kristine Meyer, Retirement Plan Specialist with the Stiles Financial team.
I’ve spoken before about how, as a firm, we are fiercely independent. To us, that means every decision we make is driven solely by what is in the best interest of our clients — always.
So in today’s Financial Flash, we’re going to discuss… “who does your financial advisor really answer to?”
We are a fee-only firm, meaning our compensation is transparent, reasonable, and free from hidden incentives or conflicts of interest. Every choice we make — from the financial institutions we work with, to the investments we select, to the technology operating behind the scenes — is intentional and centered around our clients’ needs.
Even the way we grow our business is deliberate. We have no sales quotas, no required providers, and no revenue targets influencing how we serve clients. And importantly, we have no desire to sell out or merge into another firm in a way that could compromise our identity or the client experience.
That matters because consolidation in the financial industry has become increasingly common. In 2025 alone, there were 322 RIA mergers and acquisitions, compared to 205 in 2020. Large firms are acquiring smaller firms as succession strategies, to expand geographically, or simply to increase scale. The same trend is happening at the financial institution level, where recordkeepers acquire competitors or service models to broaden their offerings.
At first glance, consolidation can sound convenient. Some may see value in having fewer places to manage their financial information. But much like an intentionally built investment portfolio, putting everything in one place is not always the same as being diversified.
Yes, larger firms may benefit from economies of scale and broader resources. But if your entire financial experience is tied to a massive organization and a call center, where is the independence and personal accountability in making sure you are truly being taken care of?
Unfortunately, many people lack the financial literacy needed to question the institutions holding their assets, so they naturally place trust in systems they may not fully understand.
And in an economy where growth and market share are often viewed as measures of success, acquisitions can also serve as a fast way to boost assets under management and increase a firm’s market value.
Which brings me to another growing force in this space: private equity.
Of those 322 RIA acquisitions in 2025, 51% involved private equity-backed aggregators. At the end of the day, private equity firms exist to generate returns for investors. That does not automatically make them bad actors — in fact, private equity can provide capital, improved technology, and succession opportunities for firm owners.
But even if your fees stay the same and your day-to-day interaction with your advisor appears unchanged, private equity ownership introduces an inherent conflict of interest. The firm no longer answers solely to clients — it also answers to investors and financial backers.
At the end of the day, independence gives us the freedom to do what is right for our clients — and that is something we intend to protect. We are grateful for the trust our clients place in us, and it is an honor to continue earning it.

Disclaimer:
Stiles Financial Services is an SEC registered investment adviser based in Minnesota. Information presented is for educational purposes only and does not constitute an offer or solicitation to buy or sell any securities or investment strategies. Investments involve risk and are not guaranteed. Past performance is not indicative of future results.