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Fee Change Thumbnail

Fee Change

No reason to beat around the bush with this week’s topic, so let’s get right to it.  Starting January 1, 2023, my annual flat fee will be $12,000.   This is for clients who are new to the firm as of that date, not anyone on board before the end of this calendar year. 

Some of this increase is due to inflation as my expenses have increased. However, the driving force is simply to better match the services I provide to my select number of clients. As a reminder, I charge one flat fee for comprehensive financial planning and investment management services. And, this fee is based on my knowledge, experience and service level. 

I started in this world in 2006 and a common theme that has run throughout my years of experience and seeing how other advisors run their practices is simply I am an anomaly. But in a good way. 

Most advisors I know meet once a year with clients. Maybe twice if you are fortunate. Heck, I worked with a business coach a few years back who continuously hammered on me “no credible advisor meets a client more than twice a year.” Perhaps I am odd as I guess I provide a service level I would expect as a client. 

This means I spend much more time with my clients than the average advisor. However, this is what I like as I really get to know my clients. In addition to the frequent meetings I have with clients, I provide a rather high level of service too. Below are some highlights. 

  • Investment Management. Many of my clients like to manage their own investments, which has been fine. However, my flat fee also includes managing their assets. Yeah, you cannot avoid the investment fees themselves, but unlike other “flat fee” advisors out there I do not charge a separate fee to manage assets.
  • Advanced Financial Planning. Once a year I update the financial plans for all my clients.  For quite a few, we do it more than once a year as life happens, jobs change and plans need to be updated more frequently.  I stress that financial planning is a verb and the process is more important than the plan itself. And my advanced financial planning takes roughly 20 hours per year per client. That total does not even include my paraplanner’s time.
  • Tax Reviews. Again, I’m not a CPA and never will be.  Nor have I slept at a Holiday Inn Express.  Wait, I digress.  Every year clients and I do a deep dive into their most recent tax return, do some projections for the current year, and start planning for the future. You know, things like Roth Conversions. Remember – it’s not what you make; it’s what you keep. I mean, unless you like tipping Uncle Sam.
  • Insurance Reviews. I do NOT sell any insurance products. I dropped my insurance license when I started my own firm. However, I still do deep insurance reviews with all of my clients.  If we identify an insurance need, I help design the solution and then a client can go to their own agent to get the insurance they need or I have a low-cost insurance specialist I refer clients to.  The nice thing is they work on salary and not commissions.
  • Estate Planning.  Once again, not an attorney.  However, part of what I do with clients is to ensure their estate planning documents are in order.  This is one of those areas that often gets ignored until it is too late.
  • One-Off Topics – There are areas we need to do every few years, like making sure all beneficiary information is updated or accounts are titled properly.
  • Retiree Healthcare Planning – I will be adding an additional service next year focused on retiree medical expenses, like Medicare planning


There are some other services I provide to clients, such as account aggregation tools, regular performance reporting emails, frequent communication, always being on-call for my clients (they all have my cell phone number), and never charging more for extra calls or meetings.  Another item to mention is I bring proactive ideas, like I Bonds this past year. I’m sure your advisor talked to you about I Bonds. That’s a tongue-in-cheek comment as many advisors never recommend any idea that reduces the assets they can manage and charge on. 

I have spent a lot of time thinking about raising my rates. I try not to compare myself to what other advisors charge, but I will share a quick comparison. My average client size is $3 million. The average advisor charges a client of this size $22,500 a year. Again, my new flat fee will be $12,000. I don’t know about you, but after about 20 years in retirement the cumulative savings of $210,000 sure could go a long way.  Heck, that’s a lot of nice annual trips in retirement. 

Something I have mentioned before is how careful I am in screening potential clients. That is a nice feature of charging everyone the same. I look for fit and not size. I recently turned away a potential client who was well over $100 million of investable assets. While every advisor I know would have killed for his business I knew he wouldn’t be a good fit and so I recommended he continue his search. 

Ultimately, the driving reason for this change is so I can spend more time with my clients, which is becoming a smaller and more selective group.  When I first launched I envisioned capping out at 100 clients.   However, that number has dropped dramatically and once I hit it the no vacancy light will turn on.   Additionally, to provide the service my clients expect and deserve, I will only be taking on 4 clients per year.    

While most firms want to grow quickly, I believe in smart growth. I also believe having one flat fee for financial planning and investment management services that are based on my knowledge, experience and service level is the right way to charge clients. And my select group of clients seem to think the same way.