NOTE: Most Financial Planners/Investment Advisors
are paid: (1) A "bargain" fee for a "financial plan", and/or a fee equal to a percentage of assets managed (this
fee is often disclosed); AND, (2) Commissions on products sold to the client (these commissions
are seldom disclosed, and are usually several times larger than the often disclosed fees). In professional
parlance, this is usually referred to as "Fee Based" compensation. R.O.I. IS NOT COMPENSATED ON THIS BASIS.
FULL-SERVICE CLIENTS and INVESTMENT MANAGEMENT CLIENTS
Fee Retainer
Relationship – R.O.I. believes it is very important to motivate an advisor to do what is in the best interest
of clients. R.O.I. believes this is best accomplished via a 100% disclosed Retainer Fee Relationship .
Fee – The fee is
calculated as a percentage of managed assets. In this manner the advisor is paid more if the managed assets grow, but paid
less if they decline. Because investment management does not become proportionately more time consuming and difficult as managed
assets grow, R.O.I. believes a declining fee schedule should be used. Because R.O.I.’s family managed office
in the home structure (see About Us , Organization Structure) minimizes overhead, R.O.I. can have
a competitive initial fee percentage which rapidly declines. R.O.I.’s current fee structure is:
1.25% of the
first $250,000 of managed assets, plus;
1.00% of the next $250,000 of managed assets, plus;
0.75% of the next $250,000
of managed assets, plus;
0.50% of the next $250,000 of managed assets, plus;
0.25% of any managed assets in excess of
$1,000,000.
For example, a client with a $1,250,000 portfolio would pay, per year:
1.25% x $250,000 = $3,125, plus; 1.00% x $250,000 = $2,500, plus; 0.75%
x $250,000 = $1,875, plus; 0.50% x $250,000 = $1,250, plus; 0.25% x $250,000 = $625;
for a total of $9,375/year, or .75%
x $1,250,000.
Most investment advisors charge higher fees for investment management
only. But with R.O.I., this fee is a retainer for ALL the services R.O.I. provides, not just investment
management (see Services), and is the only compensation R.O.I. receives.
POSSIBLE CONFLICT OF INTEREST - Because
R.O.I. is paid only on a percentage of manged assets, a conflict could arise relative to R.O.I.'s advice about a client's
use or allocation of manageable assets (but see NAPFA Oath & Values)
COMPREHENSIVE FINANCIAL PLAN (CFP) CLIENTS
Clients
who do not yet qualify or who currently do not want to be "Full-Service Clients" or "Investment Management
Clients", can receive a Comprehensive Financial Plan (CFP) (limited to the "Analyses" only section of Services). These analyses will clearly tell:
(1)
The way things really are;
(2) What truly should be done; and,
(3) R.O.I. won't try to sell anything.
R.O.I.
provides CFPs as a professional and affordable service to a wide range of CFP clients. R.O.I. currently charges $750
for a regular CFP ($375 paid up front and $375 paid upon presentation). CFPs involving complicated business, estate
and/or asset protection planning, are charged on a case by case basis.
351 East 140 North , Lindon, UT 84042-2004
Phone:
801.785.3254 Fax: 801.785.3244 Email: ronolson@itsnet.com
