How Much Does a Fractional CFO Cost?

An Introduction to Fractional CFOs

What Is a Fractional CFO?

A fractional chief financial officer or CFO is a professional who can offer financial guidance services to businesses on a contractual basis. A fractional CFO can work on demand to provide the necessary support to allow a group to function. Many teams will hire these professionals because a fractional CFO cost will be less than what a full-time CFO might charge for support.

Why Hire a Fractional CFO?

Hiring a fractional CFO is one of the best ideas you can consider for your business, as that CFO can bring one’s professional experience to your company as needed. Fractional CFOs are experts who can help you produce budgets, review contracts, and keep all your financial data in check. The work that your CFO provides will ensure you receive the assistance necessary to keep your business running.

What Factors Affect the Cost of a Fractional CFO?

The cost of your fractional CFO will vary over a few points:

  • How long you’ll hire the CFO for
  • The experience the CFO holds
  • The complexity of your tasks
  • Accessibility, including how well a CFO can review your data

How Much Does It Cost To Hire a Fractional CFO?

There are three separate measures you can use to see how much does a fractional CFO cost:

  1. Hourly Rate

Many fractional CFOs have hourly rates for service. Expect to spend from $200 to $400 an hour on a CFO’s services. Therefore, if you need a CFO for 20 hours in a month, you could spend at least $4,000 for that month’s services.

  1. Monthly Retainer

A monthly retainer works where you’ll establish an agreement with a CFO to use that expert’s services as necessary. You can pay the CFO a monthly charge for services up-front. The total can be around $2,000 to $4,000 a month, depending on who you hire.

  1. Project-Based Fees

You might also find unique fees based on what projects you want to complete. A CFO might review how many hours it might take to complete your work based on the task complexity and the resources you hold. The CFO will then dictate a suitable fee based on the task. That total could reach anywhere from $1,000 to $5,000, depending on your requirements.

Factors Affecting the Cost of a Fractional CFO

There are a few points that can influence what you’ll spend on a fractional CFO’s services:

  1. The Size and Complexity of the Business

Look at factors like what products or services you offer, how you source these items, your bank accounts, and the outside business partners you hold. A business with more accounts, connections, and other assets will take longer for a CFO to review, causing you to spend more on services.

  1. The Scope of Work Required

Some CFO tasks might be more complex than others. You can ask a CFO to help you manage your tax reports or request budgeting assistance. The more complex tasks will cost more because they take longer to finish.

  1. The Experience and Expertise of the Fractional CFO

A fractional CFO will charge you extra if that CFO has more experience. CFOs that have been working longer often charge more because they have extensive proof of their ability to complete tasks.

How to Choose a Fractional CFO

You can find a suitable fractional CFO for your use by using a few steps:

  1. Ask For References

Check prior reviews and reports on what a fractional CFO has done for other clients. You can use these references to learn more about how a fractional CFO can work for you.

  1. Get Quotes From Multiple Providers

Different CFO services will charge varying amounts for what they offer. Look at how providers charge for similar tasks, and make sure you find a choice that works for your budget.

  1. See How the CFO Fits Your Business

A good fractional CFO will understand your industry and how your business operates. A CFO that recognizes how you function while offering a plan for work will be a worthwhile hire.

The Takeaway

The fractional CFO cost you’ll spend will vary over whatever service you request and how experienced your CFO is. The billing schedule can also influence the cost, as some schedules might be appropriate for short or long-term tasks. An hourly charge might work for minor tasks, while having a monthly retainer can work for extensive projects.

But whatever you find, compare options while reviewing how well your prospective CFO can access your content. Be aware of how detailed your task is, and make sure you find someone who can serve your needs.

You can consult us at the Wheeler Group for further details on what you might find in a CFO that can serve your group.

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