Finicade
🔍 Sign in
Everyday Money

Commission

Also called: sales commission, commission-based pay

Commission is pay calculated as a share of what you sell — a percentage of revenue, premium, or transaction value. As compensation it aligns effort with output and makes income lumpy, which is why commission earners need larger cash buffers and zero-based budgets. As a warning label it matters more: when the person advising you on a mortgage, insurance policy or investment fund is paid by commission, their incentive is the sale, not the fit. That's the structural argument for fee-only advice.

← All Everyday Money terms