Investing and being an investor are two separate things.

Of course there is a cost to being invested in the market and a cost to working as an investor with a financial advisor, but only a very small portion of the fee clients pay their advisor should be allocated to the investments themselves.

Advisors should follow fundamentals, not fodder, to help clients have the fortitude they’ll need to achieve their most important long-term goals.


Investing takes knowing the fundamentals, but being an investor requires fortitude. Investing means putting capital into something for an expected rate of return.  Historically, stock markets have been the greatest creators of wealth in the history of mankind.  However, there are fundamental principles one must follow in order to have capital earn those market rates of return:

  • Keep costs low
  • Keep taxes low
  • Understand and manage risk during portfolio construction

More and more people are starting to understand these principles, which is why passive investing has been on an upward trend since the 1970s. The overall cost of an investment portfolio which applies these fundamentals is fairly low, but this is only half of the formula for achieving long-term success.
Advisors should do everything they can to separate their fee from market performance because an investment portfolio is only as good as the person in control of it. 


What most advisors should be charging their fee for is providing fortitude for their clients.

According to Merriam-Webster’s Dictionary, Fortitude: strength of mind that enables a person to encounter danger or bear pain or adversity with courage.

Most investors need the support of a professional advisor who can help coach them through periods of fear or uncertainty.

A good advisor not only puts together a prudent financial plan, but also helps keep clients from sabotaging that plan by letting their emotions dictate their decisions. Even more, a good advisor helps clients in areas such as wealth transfer, wealth protection, charitable giving, tax planning, etc.  

When your brand’s messaging speaks to the guidance and service you provide for the all of the above topics, your conversation about your fee is easier. 

Without it, you end up being lumped in the “stockbroker or mutual fund salesperson” bucket, and very few clients place much value on that.


Charles Schwab has built a solid business around encouraging clients to lower their investment costs, but nobody can compete against your value proposition of providing coaching to help people reach their long-term destination.

Remember, separate how much you are charging to get “returns” and how much you are charging to help your clients clarify and then reach their goals in all aspects of their lives.

Make sure your messaging — your website and every communication — reflects your belief that fundamentals plus fortitude equal long-term investment success. It makes it much easier for clients to see that your fee encompasses so much more than capturing market performance.

Steve Atkinson is the head of advisor relations for Loring Ward, a third-party asset management program (TAMP), with over $8.4 billion AUM. His team is dedicated to helping the independent advisors who partner with Loring Ward to grow their businesses through ongoing support and coaching.

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