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Apr 18, 2012

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It is not about price, it comes down to trust Tuesday, September 20th, 2011  |  Filed Under: Practice Management

“The demand in finances doesn’t respond to price,” Trott says. “Having a lower price doesn’t guarantee you more business. It’s not really about the price. It’s about the quality of service.”

There’s a great article in about pricing advisory services. It’s based upon a study conducted by PriceMetrix showing that advisors who didn’t lower their fees in the aftermath of 2008 market are much better off today than those who decided to reduce their fees.

This is more evidence that clients are seeking good advice from trustworthy advisors more than a deal on the management of their financial affairs. Take a look at the article

Clients Are Increasingly Using Multiple Financial Advisors Wednesday, August 17th, 2011  |  Filed Under: Practice ManagementUncategorized

This recent article (see link below) really caught my attention. It is a very enlighting that the statistics discussed indicate many investor clients have determined that they can fend off challenging markets and volatility by engaging more than one financial advisor to handle their financial affairs. Moreover, the more wealthy the client is, the more likely they are to utilize many advisors. Perhaps diversification is part of the driver, but this trend sure appears to be an opportunity for seasoned advisors who have the platform capabilities to efficiently organize the clients’ data, reports and recommendations. Few firms provide advisors with the right wealth manager tools to position themselves for this type of role, and it’s it fairly challenging for individual advisors to scale their operations to offer these kinds of capabilities. Advisors who position selves with a firm that supports a wealth manager role will have much greater success serving these types of the clients.

When “100% Payout” is Not What You Think. Wednesday, July 13th, 2011  |  Filed Under: Going IndependentPractice Management

One of my father’s favorite sayings was “there is no free lunch.” As much as I tried to prove this wrong over the years, I admittedly learned in business – - the hard way a few times – - that there’s typically a catch to just about everything that’s “free.”

Knowing that the brokerage industry is famous for the many ways it creatively generates revenue streams from products and services, I thought about the aforementioned truism with a recent industry news column about a brokerage firm announcing “100% payouts” on fee based business. Even among the least suspecting of industry participants, this type of a claim raises questions, if not a big red flag.

For anyone who has ever managed a broker-dealer, you know that 100% doesn’t add up to 100% in broker-dealer land. There all sorts of ways firms play games with their math to create the illusion of higher payouts. Marketing allowances, revenue sharing, mark-ups on administration, ticket charges, postage and handling are just a few ways brokerage firms generate extra income to cover their high payouts. When one adds it all up, you have to wonder why b/ds would go to such an extreme measures. Why not just charge a fair and competitive rate for the services provided? Well, the answer is as elusive as the word “transparency” tends to be in the broker-dealer world.

One of the most refreshing aspects of the RIA business model is that there’s an appreciation for, and reality to the costs of operating a business. Perhaps it’s the simplicity of a 1% fee annual fee and that there are fewer mouths to feed in the advice model that drive this thinking. Even the least sophisticated of fee advisors seem to have a greater appreciation for transparency that enables them to operate in complete alignment with their clients.

At Dynamic Wealth Advisors, we generate profits one way: with service fees received only when we service your fee based assets. There are no mark-ups, no marketing allowances or other “funny money” as I like to call it. Our interests are completely aligned with RIAs and IARs we serve. While the RIA business may not be a perfect model, from my view there seems to be much more understanding and appreciation for the value that industry participants like DWA are able to create for advisors and a lot fewer tempted by “the free lunch.”

Are IBD Reps the Next Wave for RIA Model? Monday, January 24th, 2011  |  Filed Under: CustodiansGoing IndependentPractice Management

A recent article in predicts that advisors moving to the RIA model will be coming in greater numbers from independent broker-dealers. The sources point to the fact that many advisors are reaching the magical $100 million of assets under management that many times creates the urge to make the switch to more capabilities and the opportunity for greater control as a business owner and advisor. 

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Posted: Apr 18, 2012 5:17pm


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Dagmar Irvine
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