The Monthly Retainer Model in Financial Planning

Transparent pricing requires you to understand, believe, and communicate the value of your services. The monthly fee will be less than the value you likely provide when you consider what you’re doing for your clients. You could improve cash flow to save money, change insurance policies to more appropriate products, or invest wisely to grow wealth f

An AUM-only business model bases the revenue of a financial planning firm on something advisors cannot control: the markets.

The greatest thing about the monthly retainer model is that it allows me to help the upwardly mobile professionals achieve wealth faster. It really fills a gap and makes planning accessible for people who aren’t wealthy — yet.

Advisors must absolutely believe that the value of the financial planning they provide is worth what that client is going to pay for it. Here’s the good news: financial advisors who provide comprehensive financial planning services for $100 to $200 per month give clients thousands of dollars of value in exchange.

I also recommend figuring out a niche as early in your process as you can and try very hard to stick to it, even if that means your growth is a bit slower in the beginning. In order to help from a cash flow perspective, offer some sort of quick start program but reserve your monthly retainer clients for your niche.

I charge a one-time onboarding fee of $1,500 which covers the first 2 months of service. I then charge an annual retainer (billed monthly or quarterly). The annual retainer is $2,400 for a single person and $3,600 for a married couple. My fees for investment management are 0.75% on the first $1M and 0.5% afterward.

Conduct Coffee Meetings (AKA: Modern Market Research)

Younger clients are dealing with issues like student loans, cash flow, debt management, buying houses, having babies, getting married, getting divorced, starting businesses – all things that Baby Boomer and retired clients generally don’t deal with (and certainly not all at once). Don’t work with next generation clients just because you think they’

Charging a monthly fee and tacking on investment management as a separate AUM charge allows you to clearly distinguish what you offer. You create two separate fees for two separate services. And to an earlier point, this also allows you to provide investment management without asset minimums, since it allows you to be profitable on the financial pl