• Upperline Financial in New Orleans adopted a fee model built around Gen Xers, the firm’s target client. The firm linked the advice fees to income and net worth to create an affordable service for young clients and a way to build future business.
• Solari Financial in Boston and New Hampshire allows clients to subscribe to a planning model based on their preferences and personality type.
Other firms, such as AdvicePeriod in Los Angeles, use a super retainer, giving unlimited advice for a yearly retainer. Timothy Financial, based in Wheaton, Ill., and Red Bank, N.J., charges hourly fees based on the complexity of the planning needs.
The report warns there are inherent dangers in fee innovation.
“Innovation failure is a real risk, and unfortunately a likely scenario, especially when innovation is approached in haste,” Jackson said. “There are essentially two ways to fail: One is to fail to gain enough customers as a result of over-pricing, while the other is underpricing, which negatively impacts growth. What is abundantly plain is that inaction is not a viable strategy.