When it comes to the question, “what’s your investment minimum,” many advisors try to get cute when responding.
On one hand, advisers don’t want to set too a high threshold. A high investment minimum may leave some folks left to interpret “we’re too small to be a client of yours!”
On the other hand, an advisor announcing they will work with “any account, any size” may set off alarms for some, and appear desperate for business.
We’ve also discovered some folks who are thinking of working with us simply use that question (“what’s your investment minimum?”) as a way to find out how our process actually works. So let’s talk briefly about that.
The “Fit Meeting”
Our very first meeting is what we call a “fit meeting.” We simply invite you to spend 30-45 minutes with us, as we get acquainted. We want to hear your story, and give you the opportunity to ask any questions on your mind. You are not required to bring any statements, tax returns or other data to this meeting. It is simply a “get-to-know-each-other” meeting.
“Let’s Get You On Track” Meeting
The second meeting in our process is called the “Let’s Get You On Track” meeting. It’s at this meeting we want you to bring in all the financial data you have available. At this meeting we will ask you to you sign an agreement for us to begin working together.
Before digging into the investment minimum details, it’s important to know all clients of Mullooly Asset Management work with an adviser to develop a financial plan first. In industry slang, rather than “lead with a strategy” or “lead with a product,” we instead “lead with planning.”
We do not produce a large, boiler-plate filled two-inch thick written financial plan. Those plans are often obsolete before the ink dries. Financial plans are meant to change. Plans are meant to be flexible, to consider different options, different paths “your financial life” might take. As your life changes, we want your plan to change along with it. We would be happy to show you different possible outcomes and scenarios, as your story evolves.
For example, while we are not licensed to sell insurance (I was insurance licensed for many years as a broker), reviewing your insurance coverage is something nearly every potential client asks us to perform.
About those investment minimums:
We have a different take on that question, “what’s your investment minimum?” Which is why we’ve crafted our answer this way:
We have two arrangements for our clients: for those with under $250,000 in investable assets – and those with over $250,000 in assets.
Assets under $250,000
What if you are in a situation where most of your assets are tied up in retirement accounts at work, and you do not have $250,000 or more invested in a brokerage account? Some of the folks we meet in this situation need financial planning guidance more than others.
For example, you have a 401k account at work, are trying to start a business, or save for a home. Or possibly get out of debt, or whatever your situation. For potential clients with less than $250,000 in investable assets, we have a monthly subscription service.
The monthly subscription service has an initial $1000 fee upfront, and then a monthly subscription of $125. With the monthly subscription we can work with individuals to establish a cash flow projection, prepare a personal balance sheet, and analyze an individual’s tolerance for risk. We will 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). Including the upfront fee, the total cost of this package is $2500 in year one, and subsequent years is $1500 per year. Clients may terminate their arrangement at any time. If (when) a “subscription” client surpasses $250,000 in investable assets, our normal fee schedule would then apply.
Assets over $250,000
For potential clients with investable assets over $250,000, our traditional fee schedule applies. You can find that fee schedule here. What do we mean when we refer to “investable assets?” 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, 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.
In cases with new clients with assets over $250,000, we *still* lead with planning. Before any investment changes are made, we will work with you to prepare a cash flow projection (both now and at retirement), a personal balance sheet and work with you to determine an appropriate level of risk in your investment accounts.
Until recently in our industry, it used to be fee schedules were never posted publicly. And if you had to “ask what the minimum was” you probably weren’t a prospective client. And working with an investment adviser was reserved for only the very wealthy.
Each client has a unique situation. They have a personal story that is theirs, and theirs alone. We promise to listen to your story, and work together with you to build a financial story all your own.
If you are ready to get the conversation started, click here.