I would talk to your advisor and have him/her break down the 3% fee. That seems high, even if it includes investment management and financial planning, but it is impossible to say for sure without knowing exactly what the fee covers. If s/he cannot, or will not, lay out clearly (and in writing) how the 3% fee is composed and what it covers, I would suggest looking for a new advisor.
Even if s/he can do that, it probably wouldn’t hurt to talk to a fee-only financial planner and getting a “second opinion.” A different fee only planner can look at your situation and help you determine whether you are paying too much, etc.
Without knowing more, I would tend to think that if you are working with a fee-only planner, your TOTAL fee should fall somewhere in the 1-2% range, and that should be for absolutely everything - i.e. investment management, financial planning, all reporting, working with your other financial pros, you having the ability to your planner as much as you want to during the year, etc.
As for your question about a 7-9% return, I would suggest that that is a perfectly reasonable expectation for a properly allocated, well-diversified portfolio over the long-run (say, at least 10 years). However, if you are invested more conservatively (say 50% stocks, 50% bonds, or with an even lower exposure to stocks), then you might be pushing it and you might have to dial back your expectations of 7-9%.
Additionally, anything can happen in the short run, so a 7-9% return over the next 5 years could happen, but I wouldn’t rely upon that in any way for planning purposes, because there is simply too much that can happen on a short-term basis.
Finally, 702 accounts are real, but they are life insurance that people try to make sound like retirement accounts. Here’s a recent article with additional information (http://cheatgame.info/blog/investing/whats-702-retirement-savings-plan/).
Hope that helps and best of luck. Please feel free to reach out with other questions.