As fee-only investment advisors, we have a straightforward compensation structure.
We are only compensated by the fees our clients pay us. We receive no hidden fees, kickbacks, commissions. Your fee is based on your assets we have under our management. We have a fiduciary obligation which includes trying to keep your fees as low as possible.
Our fees are billed quarterly, in advance. Fees are based on the total value of your assets under management on the final day of the prior quarter.
How to Calculate Your Fee
Suppose you have exactly $900,000 in assets under management today. We take the value of your assets ($900,000) and apply it to the fee schedule above to get an annual fee of 0.50%.
When we multiply $900,000 by 0.50%, your annual rate is $4,500.
To calculate your bill for this quarter, we divide $4,500 by four (4), which is $1,125. The quarterly fee is billed directly through the accounts at TD Ameritrade.
Since asset values can change, we perform this same calculation each quarter.
Assets Under Management
What do we mean when we refer to “assets under management?”
These are accounts with a bank or broker which can be moved (transferred) to our custodian (TD Ameritrade Institutional).
This would include personal investment accounts, trust accounts, IRA’s and other types of investment accounts, including retirement plans.
For these clients, the quarterly fee is billed directly through the accounts at TD Ameritrade.
What if your “assets under management” are less than $250,000 ?
What if most of your assets are tied up in retirement accounts at work, and you do not have $250,000 or more invested in brokerage accounts?
Some of the folks we meet in this situation truly need financial planning guidance, but get turned away from other firms for not meeting some firm’s arbitrary “minimum account size.”
For example, perhaps most of your money is in a 401k account at work. Perhaps you’re trying to start a business, or save for a home. Or possibly you’re looking for a plan to get out of debt.
For potential clients with less than $250,000 in investable assets, we have a monthly subscription service.
The Monthly Subscription Service
Our monthly subscription service has an initial $1000 fee upfront. Starting in month two, there is an ongoing monthly subscription of $125. Including the upfront fee, the total cost of the monthly subscription package is $2375 in the first twelve months (year one).
In subsequent years the monthly subscription is $125 per month, or $1500 per year. Clients may terminate their arrangement at any time. When a “monthly subscription” client surpasses $250,000 in investable assets, our “assets under management” fee schedule would then apply.
What is included in your fee
Regardless of which fee schedule is right for your situation, we work with our clients in the exact same way: we start with planning.
What that means is we begin by establishing a cash flow projection and prepare your personal balance sheet. We will also analyze your tolerance for risk. We’ll review your insurance coverage, make recommendations, and answer other financial planning related questions. We also offer guidance with a basic asset allocation in any investment accounts (including your retirement accounts at work).
We stand by ready to offer guidance on cash flow management, retirement income planning, reviewing your investments, charitable giving, saving for college, estate planning, tax analysis, and reviewing life insurance needs.
Every client has a unique situation. They own a personal story that is theirs, and theirs alone. We promise to listen well, and work together with you to build your financial story.
