Anyone else providing subscription-based financial advice?


My firm provides fiduciary financial planning/coaching on a subscription-based basis. Or, for you older folks familiar with the term, a retainer-based basis. Our clients are loving that financial advice and investment management are provided as two separate and distinct services. Clients can choose either or both. Is anyone else using this model?

Financial Advice
Investment Management
Financial Coaching
Subscription Models
Fiduciary Services
Steve Hartel
5 months ago

5 answers


From what I've seen this is a popular model with many younger advisors including many I've seen as part of the XY Network. Seems to make sense for younger clients and perhaps others as well. What's your plan for clients as they accumulate more significant investment assets?

Roger Wohlner
5 months ago
Roger, the model applies equally to all clients, regardless of age, income, or asset levels. If the client wants advice, they pay a fixed annual retainer fee. If they want investment management, they pay an asset-based fee. If they want both, they pay for both. - Steve 5 months ago
Sure separate and distinct services = SEC v RIA = Salesman v Fiduciary? - Dr. David E. Marcinko 26 days ago

I work with a fee-only fiduciary investment advisory firm ( a 3(38) advisory firm to be exact.) I would submit this is the only way to go. Commission-based advisors are compensated by transaction. "Fee-based" are a hybrid of commissions and fees. "Fee-only," as the name implies, is where advisors get their compensation solely from their clients. There are no commissions, no 12b-1 fees, no "pay to play," etc.

Fee-only allows the advisor to always be on the same side of the table as the client with full transparency and to truly work in the best interest of the client.

Doug Duggan
5 months ago
Doug Duggan Doug, do you think the trends in the industry can support a large segment of fee-based on FULL ASSETS advisors let's say for another 10 years? My thought is that we will see a more bifercated industry with RIA's unable to charge a fee on ALL assets with the advent of robos and hybrid models? - Rob 5 months ago
Doug:: You are talking about the fee that an advisor charges for managing investments. That's not what I'm talking about. I am talking about charging a retainer (or subscription) fee for providing ADVICE. - Steve 5 months ago
Rob, I think you're on to something. We consider assets under management to be different than assets under advisement. We only charge for assets under management but will give advice to our clients on any subject with a dollar sign in front of it. We have a CPA on staff and a close relationship with a trusted estate planning attorney. - Doug 5 months ago
Steve, my mistake on the definition. However, for our quarterly fee, our clients have the right to ask us anything, even regarding what we do not manage (e.g. tax planning, business/borrowing/credit issues, 529 plans held elsewhere). As a fiduciary, we consider advice intrinsic to the value we add. Have you found clients have enough onging questions to consider the retainer a good value? - Doug 5 months ago
When the DOL first proposed their Fiduciary Rule, they stressed how financial advice/planning and asset management were two distinct services. The old model of charging for investments and giving away free advice doesn't make sense in today's regulatory environment. Our firm heartily enorsed this concept, as we were already a few years down this path at the time. - Steve 4 months ago
We provide proactive financial coaching to our clients (not just answering their questions). We help them set goals every 90 days, and we give them the tools to monitor their progress. We help them avoid biases, blindspots, and emotional pitfalls in their day-to-day financial decision making. We charge an ongoing retainer/subscription fee to provide this service. Totally separate from asset mgmt. - Steve 4 months ago
FEE ONLY is way too expensive = but a nice recurring revenue model for the "advisor" - Dr. David E. Marcinko 26 days ago

I believe this trend will be very powerful as the financial services sector becomes focused on automated advice models. Robo advisors, ETF's(managed or not) and other focused investment strategies have taken many FAs/RIAs out of the "investment management" business. The role of an advisor(in general terms) is changing at a hyper pace with new technology allowing advisors more time and flexibility in handling their existing clients and prospects. I believe we will see a continued path toward a more a la carte experience between advisor and investor.

Rob Bickford
5 months ago
Define "Advisor" - Dr. David E. Marcinko 26 days ago

Putnam recently published how a recent number of studies show an advisor can increase a portfolio’s annual return from between 1.55% to 4.00%. Also, analysis by CIRANO found that after 15 or more years with an advisor, a household accumulates 273% more assets than a non-advised household. 

Would you pay 1% annually to make 1.55% to 4.00% more than you otherwise would have? Would you rather have 273% more assets after 15 years than you otherwise would have? I would.
If you’d like to see the studies, let me know. I’ll be glad to provide them.

Doug Duggan
17 days ago

Putnam was not the source of the findings. It was the aggregator of the results of the five studies.

Doug Duggan
16 days ago
HA = Even more trustworthy - NOT - Dr. David E. Marcinko 12 days ago

Have some input?