The first option involves either purchasing a product that has no direct cost to the client or will be a managed account that is assessed a fee. This commission is paid to the advisor from the company from products. The fee based products usually involve investment accounts that have a quarterly fee assessed to the platform for the management of the account. When it comes to fees on accounts, we typically will also let the client choose the desired level of complexity. If someone really wants a low cost option, we can tailor an investment philosophy to that, however we would typically not do so and take a more tactical role when it comes to asset management.
The second option is a “fee for advice” type platform. Just as you would expect, going in to speak to an attorney or a physician, we can charge a fee for advice based on the complexity and time involved in working with the client. This is usually tailored to the specific need. We do not have a boiler plate fee that we charge for certain services because we truly believe that every person’s financial situation is different just as personalities are.
The last option is simply some combination of the first two. We have some clients that would want to have us actively manage one account and take a more passive role on another. This can be done as well if someone so chooses.
We have a lot of clients/prospects ask us what is the hot investment topic of the month or the week, which are fun to discuss. We enjoy it, but what is often more important is assessing if clients are really ready to get into these topics or not. We believe it is first important to review things such as risk management, legal documents, and over-exposure to the wrong assets or asset types.
Another great analogy is golf, if someone wanted to improve his/her golf game, would be most helpful to get new clubs or a day of lessons with a great golf pro or instructor? Obviously, if the person is willing to pay attention/learn, improving the swing is much more impactful than just using a different product. We find that sometimes there's too much focus on products rather than the process. At Innovative Wealth Partners, unless a client chooses otherwise, we like to focus on process first.
On top of independence, the other big problem investors face today is being treated as if they are more or less created the same, with the same needs and goals. We believe that every investor is different and deserves a personalized investment plan fitting to each individual style and philosophy.
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