Facet Wealth, a financial services firm based on an unusual business model, has hired Tyler Craig to lead its planning team and propel the firm’s expected growth, announced CEO Anders Jones.
Craig was most recently with Vanguard’s Personal Advisor Services West Coast mass affluent and high-net-worth teams. He managed 11,000 clients and more than 100 advisors. He joins a firm that was designed to serve mass affluent clients.
Created in 2016, Facet Wealth, based in Baltimore, provides services on a subscription basis, charging a yearly fee based on the amount of services used. Jones is predicting a growth of as much as ten times its current advisor network this year.
“Facet Wealth works with a widely underserved population,” Jones said. “There are 8 million mass affluent households that cannot get the attention of many financial advisors. We work with people with $100,000 to $1 million in investable assets.” Craig will add to the firm’s planning bench strength, he added.
Facet works with advisors to transition clients who do not have enough assets to be a good fit for other advisors, Jones said. “Our average client is 55 years old and has $350,000 in assets, although we serve all ages.”
Services are provided on a subscription basis and average $1,600 a year, or about 60 percent of what the clients would pay a more traditional advisor, he added. Instead of charging 1 percent of assets under management, clients pay between $500 to $5,000 per year, based on the number of financial planning services they sign up for from among the more than a dozen available.
Other firms, some of them large institutions, have introduced subscription-based planning. Charles Schwab last month announced its Schwab Intelligent Portfolios Premium, which has an initial one-time $300 fee for planning and a $30 monthly subscription that does not change at higher asset levels.
Facet Wealth will work with individual clients or will work with clients through other advisors.
“Instead of going directly to the consumer, we go to the advisors and help them transition their clients who are not a good fit for them,” Jones said. “Our typical client has had a great career and saved money, but cannot now get the attention of many advisors.
“The firms we deal with are growing and segmenting their clients. They have high quality services, but the services do not scale to the mass affluent,” he added. “We can price our services based on our advisors’ time and the complexity of the services. Our price matches the value received and is not based on assets. The future of financial planning is going to be subscription planning.”