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Wealth Professional | 23 Sep 2015, 08:15 AM Agree 0
While advisors continue to debate what would happen if embedded commissions and/or DSC funds disappear, some wealth professionals are proposing an alternative that many consider obsolete
  • Wealth Advisor | 24 Sep 2015, 11:31 AM Agree 0
    Definitely innovative thinking but if you read Mr. Kitces responses to reader comments, he acknowledges that AUM fees are de rigueur and acknowledges the likelihood of the retainer model taking precedence over the AUM model is slim.

    No surprise that the AUM model has been perceived to be a niche model for HNW clients.

    If the industry is forced by the regulators to be exclusively AUM based, it poses an interesting question - what and how do we charge the LNW (Low Net Worth) client?

    Retainers are merely flat fees charged to the client and Canadian advisors have always had that option ( subject to minimum amounts). These minimums will certainly have to disappear.

    The concept of retainers is a completely foreign concept for Canadian investors so I doubt that most Canadians will beat down our doors demanding they pay retainers. I sincerely doubt that senior clients that have RRIFs will want to pay retainers!

    Something is telling me that a fraction of a percent embedded trailer is not a bad deal at all for the LNW investor.
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