Fee Schedules

Investment Management

The fee charged for Investment Management Services is based on a flat rate schedule, applied to the assets under management. This arrangement avoids any "conflict of interest" questions arising from commission-based compensation and provides a mutual incentive for the success in growth of assets. The investment management fee is inclusive of all services and charges related to the investment management during the client relationship (not including trading fees charged by custodian). The fee is based on an annual percentage of the assets under management and is billed to the account on a monthly basis (Annual Fee /12).

The determination of the annual fee amount is in accordance with the following scale:

As an example, a client with a portfolio of $500,000 would be charged the following:

The aforementioned scale is very competitive with the internal management fees of actively managed mutual funds. Typically, mutual funds charge between 1-2% in management fees, excluding sales loads which can be an additional 5% in fees. Additional items adding the high cost of mutual fund ownership include redemption fees, 12-b1 fees, transaction fees, fund taxes and the cost of carrying cash in the fund.  The cost of owning an actively managed mutual fund can be upwards of 6-7% of your assets when all is said and done. 

Under certain circumstances – depending on the client’s net worth and assets under management - we may enter into a performance-based fee agreement. The performance-based fee may be determined as follows:

• A (negotiable) base management fee charged as a percentage (i.e. 1%) of the assets under management of each account subject to this fee arrangement and is paid monthly (Annual Fee /12).
• A (negotiable) performance fee component calculated as a percentage (i.e. 20%) of the Net Excess Profits (if any) in each account. Net Excess Profits shall be defined as realized and unrealized profits in each account that exceeds a predetermined (negotiable) “hurdle rate” of return (i.e. 7%) per year on an annualized basis. This fee is usually paid at the end of the year.

As an example, a client with an initial portfolio of $1,000,000, a management fee of 1%, a hurdle rate of 7%, and a performance fee of 20% would be charged the following in these scenarios:

Wealth Management and Financial Planning

Single (One-Time or Annual) Financial Plan – the fee for this one-time (or annual) service ranges from $2,000 to $10,000.  Based on an initial review of the client’s financial circumstances, a specific fee will be quoted to the client based upon the expected time and complexity of the planning engagement.  Before the engagement begins, the client will be required to sign the Single Planning Agreement, which will confirm the fee in writing.  The fee will be due in two parts – 10% of the fee at initiation and the balance due upon completion.

On-going Wealth Management (WM) – there is an annual flat charge for this service and it is dependent upon the complexity of the client’s financial situation, his or her total assets under management, and the Wealth Management program he or she choices.  Generally, the more complex the situation, the more assets under management and the more comprehensive the service, the more WM fees will be charged.  Although each client’s situation will be unique, as a rule of thumb, WM fees will not exceed 5% of assets under management - including Investment Management fees - for our most comprehensive service (Platinum WM Service).  The client will be required to sign both the On-going Wealth Management Agreement and the Investment Advisory Agreement.  Fees for WM will be paid quarterly, in advance. 

The minimum quarterly fee for each WM Service Package (not including Investment Management fees) follows: 

Note: All Wealth Management clients will receive Investment Management services.

Hourly Consultation – some clients may choose not to execute a full fledged financial plan or require on-going wealth management.  For these clients we offer hourly consultation on a variety of personal finance subjects.  The fee for this service begins at $150 per hour and escalates form there depending on the financial complexity of the situation.