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Wealth Management & Financial Advisory
Plain-language definitions from the time.money glossary.
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Wealth Management & Financial Advisory
9 terms- AUM-Based Fee
- An advisory or portfolio-management fee charged as a percentage of the assets being managed (Assets Under Management), typically 0.5 to 2% a year. Because the fee scales with portfolio size rather than the work involved, AUM-based pricing can quietly cost a growing investor far more over time than a flat, subscription-based fee.
- Fee-Only Advisor
- An advisor compensated solely through fees paid directly by the client (a flat fee, or subscription) with no commission from third party product sales. This model removes the incentive to recommend higher-commission products, aligning the advisor's interest with the client's.
- Fiduciary Duty
- A legal obligation to act solely in the client's best interest, ahead of the advisor's own commercial interest. SEBI-registered Investment Advisers owe clients a fiduciary duty; commission-earning distributors do not.
- Financial Advisor
- A professional who helps individuals plan and manage their money, from budgeting and tax planning to investing and retirement. In India, only a SEBI-registered Investment Adviser (RIA) can legally use the term "advice" for personalised recommendations; everyone else is technically a distributor.
- Financial Planning
- The structured process of setting financial goals (buying a home, funding a child's education, retiring comfortably) and mapping investments, term and health insurance, and cash flow to achieve them, typically revisited as life circumstances change.
- Flat-Fee / Subscription-Based Advisory
- An advisory model where the client pays a fixed periodic fee, independent of portfolio size or transactions, for ongoing planning and guidance. It is the pricing model time.money runs on: the fee doesn't rise just because the portfolio does, and it importantly removes the incentive to churn or upsell products.
- Mutual Fund Distributor
- An AMFI-registered intermediary who sells mutual fund products and earns a trail commission from the fund house, embedded in the product's expense ratio.
- Registered Investment Adviser (RIA)
- An individual or firm registered with SEBI under the Investment Advisers Regulations, 2013, permitted to give personalised, fee-based investment advice in a fiduciary capacity, meaning the advisor is legally bound to act in the client's best interest, not to earn commission on products sold.
- Wealth Management
- The professional management of an individual's investments, goals, and overall financial life, distinct from simply buying or selling financial products. In India, wealth management can be delivered on an advisory basis (SEBI-registered, fiduciary-led) or distribution basis (product-led); the two are regulated differently and carry different fee structures.