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What’s Your Service Level?

I follow a few financial planners on Twitter and last week two of them were going back and forth (in a positive interaction) tweeting about how service levels differ between financial planners, advisors and salespeople.  One of them, Carolyn McClanahan, has a graphic on her website comparing her services to asset-based advisors and commission-based advisors.  I thought this was great as I frequently get people asking me what the difference is between what I cover with my clients and the typical financial advisor.  It is so great I created my own and figured it was worth sharing to illustrate what comprehensive financial planning looks like in my world.

Forward Thinking Wealth Management Asset-Based Fee Advisor Commissioned Salespeople
How Compensated Flat Retainer Percentage of Assets (Often 1% or more) Commission varies by product
Annual Client Cost $4,800 Example: $1 million portfolio = $10,000 ???
Fiduciary Duty Yes Yes No
Portfolio Analysis Yes Yes ?
Ongoing Investment Management Yes Yes ?
Financial Plan Development Yes ? ?
Goal Setting and Monitoring Yes ? ?
Tax Minimization Yes ? ?
Retirement Analysis Yes ? ?
Retirement Income Planning Yes ? ?
Social Security Optimization Yes ? ?
Estate Planning Review Yes ? ?
Insurance Review Yes ? ?
Student Loan Review Yes ? ?
Education Planning Yes ? ?
Mortgage Review and Assistance Yes ? ?
Health Care Planning Yes ? ?
Employee Benefits Analysis Yes ? ?
Behavioral Finance Guidance Yes ? ?
Coordination with Attorney, CPAs, etc Yes ? ?
Unbiased Advice (not influenced by compensation) Yes ? ?
Receipt or Payment of Referral Fees No ? ?
Account Aggregation & Portfolio Monitoring Software Yes ? ?
Weekly Contact by Advisor Yes ? ?
Virtual Advisor (Can work with clients anywhere) Yes ? ?

About Dan Johnson, CFP

I am the President and CCO of Forward Thinking Wealth Management, LLC, which is the flat-fee financial planning firm located in Akron, OH, and set up to work virtually with clients across the country. I charge clients a flat fee of $4,800 regardless of asset size. My firm is a solution to what I feel is a broken system where clients pay advisors based on something out of their control - the performance of the market.
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