On the other end of the spectrum, fintech finance company SoFi Wealth has a $1 minimum and no management fee (for accounts less than $10,000 and for SoFi borrowers; 0.25% otherwise) for a managed robo portfolio of index funds for taxable and retirement accounts. Customers also have access to virtual financial planners who hold the CFP designation.
These digital hybrid advice platforms show that there’s a demand for low-cost financial planning advice, particularly among younger investors, and Aite said traditional advisors should take their cue from that and implement their own such programs to capture a share of that audience.
“If I were an RIA, I’d be interested in solutions that build connections to the next generation as part as my business, as well as add revenue in uncertain times regarding the stock market and AUM fees,” Sophie Schmitt, senior analyst at Aite and author the report, said in an interview. “This kind of movement demonstrates interest from younger individuals and generations in receiving advice in a virtual environment and also paying for planning advice via a subscription fee—they’re used to paying subscriptions.
“There’s clearly a need for a change in how advisors are getting compensated,” Schmitt continued. “We see some firms taking apart the AUM fee and dividing it into planning and investment management.”
She noted that trend has been in place in countries such as the U.K. and Australia, where wealth management firms have decoupled the investment management fee from the planning fee.
At the very least, the pandemic has kept people apart and enabled both advisors and their clients to get comfortable with virtual interaction, so the notion of virtual client meetings isn’t a foreign concept anymore. But it might take a little time to iron out the kinks when it comes to subscription-based financial planning services.
“We’ll see the models evolve, and the price points will evolve with the complexity of the scope,” Schmitt said.
She added that subscription-based pricing for advice can be a win-win that opens up a new client segment for traditional advisors by enabling them to serve people who otherwise can’t meet the AUM minimum that a qualified financial advisor requires.

“I think there’s room for different levels of advice where, for example, someone out of college won’t need a ton of holistic planning,” Schmitt said. “They’ll need to know the basics of setting up a savings plan and allocating a little bit to an investment account, while someone approaching retirement will need a lot more advice.”