Clear Money Guide
What this guide covers
A quick view of the questions and evidence developed below.
Guides › Switching Financial Advisors
Updated July 31, 2026. Quick answer: it depends on one thing — whether your adviser bills in advance or in arrears — and the answer is already written down in a document you are entitled to. Form ADV Part 2A Item 5.D requires that “if your clients either may or must pay your fees in advance, disclose this fact. Explain how a client may obtain a refund of a pre-paid fee if the advisory contract is terminated before the end of the billing period. Explain how you will determine the amount of the refund.” If you were billed in advance and left mid-quarter, the refund method is not a favour you are asking for. It is disclosed policy.
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Related guides on this topic: AUM Fees by Balance 2026, Financial Advisor Fee Structures 2026 and Financial Advisor Fees for a $2 Million Portfolio 2026.
Which situation are you in
Billed in advance — the common arrangement for quarterly percentage-of-assets billing. You paid at the start of the quarter for a quarter of service. Terminate in week five and you have prepaid roughly eight unused weeks. Item 5.D says the brochure must tell you how that comes back. Billed in arrears — you are invoiced after the period, so on the way out expect a final partial-period bill rather than a refund. Neither is better; they just produce opposite final transactions, and knowing which you have prevents both an unclaimed refund and an unexpected invoice.
Compare your next step
Just comparing fees? Keep reading the fee guide.Optional next step
Explore an adviser match
Compare the services and the full fee before deciding whether to hire anyone.
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Ask about the full fee, what it covers and how the adviser is paid. A match is an introduction, not a recommendation from Clear Money Guide.
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The matching service is run by WiserAdvisor, an independent advisor-matching company. It opens on their site, asks for your ZIP code and a few questions, and matches you with 2 to 3 vetted advisors. It is free to you. WiserAdvisor states the service is built for portfolios of $250,000 and above. By submitting, you consent to emails, phone calls and text messages from WiserAdvisor and up to three advisors, so expect to be contacted. Advisers pay for the introduction. Clear Money Guide is paid when you complete the form, whether or not you ever hire anyone. There is no obligation to hire anyone.
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Source: WiserAdvisor’s service descriptionFind the answer in your own documents, in five minutes
Open your adviser’s Form ADV Part 2A brochure — it is on the SEC’s adviser search, and the adviser must give you one on request — and read Item 5, Fees and Compensation. Item 5.B tells you whether fees are deducted from your assets or billed to you and how often; Item 5.D is the refund paragraph. While you are there, Item 5.A requires the adviser to “provide your fee schedule” and to “disclose whether the fees are negotiable.” The seven lines worth reading in any Form ADV, and the email that requests the current ADV and Form CRS. Then check your own advisory agreement for a notice period — a termination clause requiring, say, thirty days’ notice can mean the relationship formally ends after the date you stopped feeling like a client.
The sentence to send
Add this to your termination letter, which is where it does the most work: “Please confirm in writing the date advisory fees ceased, whether fees for the current billing period were charged in advance, and the amount of any prorated refund of pre-paid fees due to me under Item 5.D of your Form ADV Part 2A, together with the calculation used.” Asking for the calculation, not just the amount, is what makes the request checkable. Our termination letter generator produces the surrounding letter, and the receipt email is the follow-up that confirms billing actually stopped — the fee that never stops is a more common problem than the refund that never arrives.
Do not confuse this with the transfer fee
They are different charges from different parties. The advisory fee is your adviser’s compensation, governed by your agreement and Item 5. The transfer-out or account termination fee is charged by the custodian or broker-dealer holding the account, is published in that firm’s schedule of fees, and is not refundable — what switching costs. And a surrender charge on an annuity is a third thing again, written into the contract. The full exit sequence: how to fire a financial advisor.
What the filings actually say. We measured the fee schedules 176 SEC-registered advisers publish in their Form ADV Part 2A filings: at $250,000 only 28.4% disclose a fee you can price at all, and the weighted median annual cost among those that do is $2,000 to $2,500. The full benchmark, with method.
A prorated refund reduces what leaving costs rather than eliminating it. The switching advisors cost calculator nets it against the transfer fee and everything else on the way out, and tells you whether you finish the move ahead on day one.
Whether there is an advisory fee to settle at all depends on which side of the firm your account sits on. Northwestern Mutual runs a 30 day written notice with a pro-rated refund through the end of the quarter, Wells Fargo Advisors makes termination effective on receipt with a pro-rata refund but does not refund the platform fee, and the two self-directed accounts, WellsTrade and Merrill Edge, carry no advisory agreement to unwind at all.