But lest you think the retainer fee structure is appropriate only for the high-net worth client, Bert Whitehead of Franklin, Mich. counsels all of the members of his Cambridge Advisors LLC to use it based upon his own experience prior to starting the advisor network in 1995. And Cambridge's motto is "An Alliance of Fee-Only Personal Financial Advisors Serving Middle America," which describes a client group that couldn't be more different from that of Keats'.

Yet Whitehead firmly believes retainer fees are the best way to charge his clientele, as well. "We never liked AUM, as it doesn't pay us for what we do, for where we add value. It's gratifying to see that the profession is adopting this approach, and I think it is much cleaner from a conflict-of-interest standpoint," says Whitehead.

What do Cambridge planners charge? Well, they don't charge $28,500 per client. After performing an initial plan at twice his retainer fee, Cambridge member Ted Roman of San Diego charges clients a $2,400 a year ongoing retainer. Cambridge member Elizabeth Barrett of Plantation, Fla., charges a $3,000 minimum retainer. And Kelly Adams, in Whitehead's Franklin, Mich.-based office, earns average per-client retainer revenues of $1,800 from her client base.

While Roman's retainer may be less than Keats', his service mix is not dissimilar. "I practice the Cambridge method of comprehensive financial planning and investment advice," says Roman, who prepares client tax returns, too. He also uses the skills he's acquired from Coach University (www.coachinc.com) to help clients "expand," as he puts it. And while his average retainer per client may not be that of Keats, Connolly, his revenue per employee is right up there. With a gross of approximately $220,000, very modest overhead, and a total of two employees (Roman and his wife), Roman's per-employee revenue also tops $100,000.

What's the difference between the firms of Keats, Connolly and Roman Financial Advisors? Primarily size and lifestyle but, of course, there must be some differences in the services clients receive for these vastly different fees. The higher the fee, the greater the access a client typically has to his advisor. Roman's service is fairly structured. He has four face-to-face meetings per year (although some are actually done by phone, as is common in the coaching arena) and performs certain specific tasks for each client. All clients pay the same $2,400 retainer and, says Roman, "This wouldn't change unless I changed it for all clients."

What happens if the client gets an inheritance that significantly increases the portfolio the advisor is managing as part of the comprehensive service covered by his retainer? In many cases advisors don't increase their retainer fee, since this fee structure is meant to take the focus off specific services or events and put it on comprehensive financial planning. The time the advisor is devoting to that client, or the value that client is receiving, must noticeably ramp up before a fee change is in order.

Bedda Emous of Fiduciary Solutions LLC in Andover, Mass., charges by retainer but tracks all of her time. "Because of time tracking, I know that regardless of the asset size, accounts up to about $500,000 take about the same amount of work and time," she says.

Ben Utley of Utley Financial Planning Inc. in Eugene, Ore., says that "what comes or goes from the portfolio has no bearing on how I set the fee. I have calculated the time it takes [to serve a client] and I use the FPA Compensation and Staffing Study to make sure my fees are in line with 'virtuoso solo' firms [a designation in the Study for the 25% most profitable solo firm respondents]. Because my core competency is working with physicians, I know what issues they are facing and I have a good idea of the amount of work involved. I also have a solution to many of their problems even before they become clients, since I've already solved the problem for others."

Advisors who haven't yet tried a retainer fee structure often assume the fee must be "re-sold" each year, but that's not the case unless an advisor finally decides an increase in the client's fee is in order. Convincing a client that he's receiving enough added value to justify a fee increase isn't difficult if that value is being continuously demonstrated during the relationship. Utley uses his mid-year client review meeting as an opportunity to bring out the proprietary checklist he calls his "Points of Review" form. On this form, which he reviews with his client, the client can see the progress they've made together towards objectives such as "reducing/controlling risk" or "making efficient use of capital," as well as planning areas that might need continued work.

Linda Leitz of Pinnacle Financial Concepts Inc. in Colorado Springs, Colo., demonstrates value a bit differently. Also a Cambridge member, Leitz performs the usual array of Cambridge services, including investment analysis, recommendations, implementation and monitoring, budgeting and spending analysis, goal setting, retirement planning, education funding planning, insurance analysis, tax preparation and tax and estate planning. Says Leitz, "We show the client the difference between our fee and the approximate cost of all these services on an unbundled basis." The difference is great enough so that Leitz' clients have no doubt they're receiving good value.