Attracting younger clients requires a wholesale change in advisor attitudes, according to Alan Moore, a CFP and co-founder of XY Planning Network.

“Whenever you look at firms that specialize in younger clients, they look nothing like the firms that specialize in baby boomers, I mean, nothing outside of the fact that we both call it financial planning,” said Moore, who is 28.

Staffing, marketing and technology are areas in which traditional advisories need to innovate, but many pricing and fee structures present barriers to signing younger clients, he said.

In fact, assets under management-based pricing can prevent younger clients from even walking in the door, especially if advisors have asset minimums.

“Imagine that you go to a doctor, who says your BMI is over 25 and says, ‘I need you to exercise more and eat less and come back to me when your BMI is in a healthy range and then we’ll talk,’” Moore said. “That’s absurd, yet that’s what we tell clients: ‘You’re not rich enough, go spend a little less, save a little more and when you hit a million, call me.’”

Then there are advisors who charge based on assets, even if the clients don’t have assets.

“I call that ‘playing the client lottery.’ You work for 20 young people for free and just hope one of them one day is rich and you make your money back,” Moore said.

“That’s a terrible business model,” he said.

The simplest and most transparent pricing model for younger clients is a monthly subscription fee, Moore said.

“They pay for their entire lives monthly, so why wouldn’t they pay their financial planner on a monthly basis?” he asked.

Advisors can more effectively estimate the cost of delivering advice and charge accordingly, and there is also a place for hourly and project-based billing.

That kind of “modular” pricing can be particularly suitable for younger clients, said John Anderson, head of practice management solutions at SEI Advisor Network in Oaks, Pa.

“And if we’re doing modular pricing, we might also want to think about modular planning,” he said, focusing on fewer but perhaps more immediate issues, such as repaying student loan debt or buying a first house, rather than a complete retirement and estate plan, which can be spread out over years.

“If we’re talking about the younger client, then we’ve got to start emphasizing advice,” Anderson said. “That’s where the fee should be charged, versus emphasizing the AUM.”

Anderson thinks that the change in emphasis is sometimes more difficult for advisors to grasp than it is for clients.

Moore agrees, adding that younger clients are willing to pay for advice relevant to their needs.

“In terms of attracting younger clients, I would argue that when they get in the door, it’s all about how you sell the value. When you show them that you can help them through whatever situation they’re in, then they will pay whatever you tell them it costs,” Moore said.

Paul Hechinger is a contributing writer for On Wall Street.

This story is part of a 30-30 series on smart ways to grow your practice.