# Commission

*Everyday Money — Finicade finance glossary*

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.

**Also known as:** sales commission, commission-based pay

**Related terms:** [Conflict of Interest](https://finicade.com/glossary/conflict-of-interest), [Bonus](https://finicade.com/glossary/bonus), [Gross Income](https://finicade.com/glossary/gross-income), [Fiduciary Duty](https://finicade.com/glossary/fiduciary-duty)

Source: https://finicade.com/glossary/commission