Why Flat Fees
Your financial plan should be built around your life, not your account balance.
You have worked hard to save and invest for the future. As you approach retirement, you should be able to make decisions about your money based on what is best for you, without wondering how those decisions affect what your advisor gets paid. SwitchPoint uses a flat-fee structure so the focus stays where it belongs: on helping you make confident financial decisions.
Traditional Fee Model Conflicts of Interest
When an advisor’s fee is tied to the assets they manage, some financial decisions can also affect what the advisor earns. A flat fee helps keep the focus on what is best for you.
Paying off debt
Using investments to pay off debt may be the right move in some situations. But for an AUM advisor, moving that money out of the portfolio can also reduce their fee.
Annuities
An annuity may or may not belong in your financial plan. An advisor’s compensation structure can influence how attractive that recommendation is to them.
Gifting
You may want to give money to family or causes you care about while you are still here to see the impact. With an AUM fee, significant gifting can also reduce what your advisor earns.
Spending
Retirement is often the time to begin enjoying what you worked so hard to build. But an advisor paid on assets has a financial incentive to keep more of your money invested.
As your portfolio grows, your fee should not automatically grow with it.
With an AUM fee, someone with a $5 million portfolio may pay many times more than someone with a $500,000 portfolio, even when the services they receive are very similar.
Larger portfolios can require additional planning, but the amount of work does not usually increase at the same rate as the account balance.
SwitchPoint believes you should benefit from the wealth you have worked hard to build. Your fee should reflect the planning, expertise, and service you receive, not simply how much money you have accumulated.
Over time, that difference can add up.
