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EP 72 - Benefits of a Flat Fee Advisor

On this week's episode I want to talk about fees. It's a huge issue within my world. More importantly, it's an even even bigger issue in the lives of clients. Fees can take the form of sales commissions, percentage of assets that an advisor manages, hourly fees and more. It's confusing and it's why I operate under a single flat fee structure. 

That's right. I charge one flat fee, $8,400 a year, for financial planning and investment services based on my knowledge and experience. I do not charge based on sales products or what the stock market does. 

You will want to hear this episode if you are interested in...

  • Being charged more because you have more [0:59]
  • What a flat fee of $8,400 per year will cost you over time vs and AUM advisor [3:29]
  • Internal investment expenses [7:16]
  • This week’s FLASHBACK [10:41] 

What the .88% AUM fees will cost you vs a flat fee

I've learned over my years in the financial services industry that it typically takes the same amount of time to do financial planning for someone with $3 million as it does for someone with $9 million. If it takes the same amount of time, why should someone potentially pay three times as much just because they have a larger asset base? 

My average client has roughly 3 million in assets. The current average fee for AUM (assets under management) advisors to charge is 0.88%. This means for those AUM advisors who manage a $3 million portfolio, clients are paying $26,400 a year. I charge $8,400 per year. Check out the episode to hear just how much damage that can do to your bottom line over time. 

This week’s FLASHBACK: Hiking Trails - Overlook Trail

I would like to say today would be a great day for a hike, but it's mid-April and snowing here. Overlook Trail in Akron is an easy hike with a great view. The hike itself is maybe a mile long. Everything is paved with an asphalt trail and it's completely flat so it's accessible for everyone. There is a small parking lot and good bathrooms. The trail starts off with you walking by a tiny pond full of frogs, you then walk through some nice trees, but the best part is the end of the trail before you start to loop around back to the parking lot. It gives you a great view of that entire stretch. It's a wonderful view, especially in the fall when the trees start to turn color. 

I personally love this trail because the deck itself is at the top of what we called Clay Mountain growing up. I grew up right near this area and we played in the woods a lot. We would climb the hill where the deck now sits on top, just so we could get a great view. At this age. These days it sure is a lot easier to park in the lot and walk the asphalt path back to enjoy that same view.

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Show notes by PODCAST FAST TRACK https://www.podcastfasttrack.com

I’m Dan Johnson, CFP®, founder of Forward Thinking Wealth Management. I run a flat-fee financial planning and investment management firm located in beautiful Akron, OH. Although I am in Akron, OH, I work with clients regardless of location. I cater to owners of equity compensation positions who are looking to organize their financial lives, keep more of what they make, and do the things they want in retirement and even now.