As an investor, you understand the importance of financial planning and investing for the future. However, you may not be aware that you could be paying less for professional advice. Here’s what you need to know about the fees associated with financial advice, and how to make sure you’re receiving quality advice at a reasonable cost.
Understanding the Fees Associated With Professional Financial Advice
When seeking financial planning advice, one must take into account the various fees associated with the service. Knowing these guidelines ahead of time can result in more transparency and efficiency within the planning process. Professionals should be straightforward about what kind of fee structure they employ, so clients know exactly what to expect. There is a range of options for payment such as a flat fee, hourly rate, or percentage based on total assets under management. Though transparent conversations about fees are important, it is also critical that the client makes sure they are given the best advice and services before committing to any plans. Focusing on the right combination of cost-effective advice and experience will ensure that customers get the most out of their financial planning.
Why Stonecrop is the Right Choice For You
Stonecrop provides services based on a percentage of total assets, otherwise known as basis points. A basis point (bp) is a measurement used in finance to describe the percentage change in the value of a financial instrument. Essentially 1 bp is equal to 0.01%, so 100 bp is equal to 1%. In the financial services industry, most firms that provide person-to-person advice often charge an average of 1% per year and decrease in percentage rates as the assets become larger.
Results from the Dimensional 2022 Global Advisor Study, which is one of the largest surveys of independent advisory firms in the US. 518 US firms participated.
From a recent data analysis of over 500 companies providing similar services to Stonecrop, Stonecrop can be seen charging lower percentage rates compared to the average financial planning firm. In comparison to other firms, Stonecrop’s fees are a standard deviation of 0.08% or 8 bp lower. Stonecrop is also 0.05% or 5 bp lower than the industry average (Dimensional, 2022).
We charge less because we believe in doing good and providing our clients with the guidance to do more with their wealth. Stonecrop advisors are highly experienced and dedicated to providing quality counseling at a reasonable price to help you achieve the goals you want to meet. If you would like to learn more about our services and costs, send us an email at info@stonecropadvisors.com. We look forward to talking with you.
AUTHOR
Doug MacGray
DATE
January 4, 2023
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