To Be Financial Adviser: $5,000 Per Year
To Do a One-Time Plan or Check-Up: $1,500*
We offer two services. One is for people who want us to be their full-time financial adviser. The other is for people who manage their own finances and investments but want our professional review or a one-time plan.
Our full-time advisory fee is $5,000 annually, regardless of the size of a client’s portfolio. It is deducted from client accounts quarterly ($1,250/quarter) at TD Ameritrade, our financial custodian. It includes financial planning.
For example, if Client Michael has $500,000 in investments, he will pay a $5,000 annual advisory fee. It will be billed quarterly at $1,250 and taken out of his accounts. Client Michael need not write us a check, though he may. If Client Michaela has $5,000,000 in investments, she will pay the same $5,000 annual advisory fee, billed the same way.
We do not charge advisory fees as a percentage of a client’s assets for two important reasons. First, they create a clear conflict of interest between advisor and client. Second, they often result in the client paying far too much in fees, which is also a clear conflict of interest between advisor and client.
The one-time planning or check up fee is $1,500* and is paid in lump sum by check or electronic transfer.
*Fees for financial plans requiring unusually complex work will be more than $1,500.
Why Flat, And Why $5,000
Our flat fee eliminates the conflicts of interest and overcharges caused by traditional percentage-based fees. Our fee is based upon the amount of time, effort, and cost it takes to thoroughly administer and service a client’s financial planning and investment management needs over the course of a year, regardless of the size of the portfolio, plus a reasonable profit margin required for us to maintain a viable business.
It also acknowledges this rarely-admitted truth of financial advisory: it does not take ten times the time, effort, or cost to manage ten times the money.
Modern advisory technology provides remarkable economies of scale that produce significant administrative cost savings. We feel strongly that those cost savings belong in investors’ accounts, not their advisors’. Our flat fee structure sends them there.
Moreover, combined with our fee-only mandate, our flat fee structure offers unmatched peace of mind to our clients. Because we are paid solely by our flat advisory fee and do not receive any commissions or hidden fees for anything we recommend, they never have to wonder how we’re paid, how much we’re paid, why we recommend what we do, where our incentives lay, or if our interest is aligned with theirs. Our one and only incentive is to act in their best interest.