(Dow Jones) Some advisors claim that limiting mutual-fund distribution fees will leave smaller investors out in the cold, but certified financial planner Matthew Tuttle says it is possible to serve smaller clients as well as larger accounts even without commissions.

"It's a moral imperative to figure out a way that you can handle those smaller clients," says Tuttle, chief executive officer of Tuttle Wealth Management LLC, a White Plains, N.Y.-based registered investment advisor managing about $120 million in client assets.

The Securities and Exchange Commission recently proposed changes to charges, known as "12b-1" fees, which are deducted from a fund's assets to pay third-party advisors and other intermediaries for maintenance, sales and distribution. The proposal would limit the cumulative sales charges, or sales loads, an investor pays and require clearer disclosure of them.

Because that will limit the fees advisors obtain through commission-based products, many say it will force them to switch to models in which they can charge investors a percentage of assets, a model which some say isn't practical for small accounts.

Tuttle, whose business is entirely fee-based, says he offers smaller clients the same planning capabilities and investment strategies as those he offers larger clients by tiering his advisor structure. Tuttle Wealth Management puts newer advisors, which his firm calls account managers, on smaller accounts. Some account managers handle accounts of up to $100,000, while others have account limits of up to $200,000, depending on their skill level, he said.

The advisor's three account managers have access to the same investment strategies as other advisors and investors, and Tuttle runs the firm's investment policy and financial planning committees, so he decides how any money is invested and everyone get the same caliber investment plan, he says.

The model permits the account managers to dip their toes into the business, and gives the $3 million investor access to the same strategies as those employed for the $10,000 investor, with the exception of two or three strategies that wouldn't work with smaller accounts, Tuttle said.

Tuttle Wealth Management's accounts range from a "couple hundred dollars," to $3 million, he said.

Noting that Tuttle Wealth Management works with a "couple of hundred" certified public accounting firms across the country, Tuttle said, "We can't go to them and say, 'We'll work with all of your clients as long as their accounts are over a certain amount.'"

Indeed, limits on distribution fees will likely mean less profit for some advisors, Tuttle said. If the regulations make a commission-based advisor who's making a good amount managing a $10,000 account convert to a fee-based account, for example, "his profitability on that smaller account goes down," Tuttle said. "But there's still got to be a way to service those accounts."

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