Ep 169: Combating Advisory Fee Compression By Unbundling Investment Management And Financial Planning Fees with Alexandra Levi

Financial Advisor Success

Michael Kitces

News, Business, Entrepreneurship, Business News

4.8 • 696 Ratings

🗓️ 24 March 2020

⏱️ 97 minutes

🔗️ Recording | iTunes | RSS

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Summary

Alexandra Levi is the founder and managing partner at Element Financial Group, a hybrid RIA that oversees nearly $430 million of assets under advisement for 170 clients. As a firm providing both investment management and financial planning services, it may surprise you that Alexandra has been able to grow her revenue to be split almost 50/50 between the two. Today she joins the show to share how she has combated the risk of fee compression and her unique approach to running a hybrid firm.

Listen in as we discuss how Alexandra shows her clients how she will keep their money organized in a way they can understand, why she continues to do quarterly meetings but keeps the majority of them virtual, and more. If you have ever wondered whether you should hire a business partner or are ready to control the direction of your career, this is the episode for you.

For show notes and more visit: https://www.kitces.com/169

Transcript

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0:00.0	Welcome to the Financial Advisor Success Podcast, where you go behind the scenes with
0:07.2	financial planner, speaker, and consultant Michael Kitsas to hear stories of how leading financial
0:13.1	advisors navigated the inevitable challenges that arise on the path to success and get insight
0:18.8	from leading industry consultants about how to break through to the
0:22.2	next level in your advisory business. And now here's your host, Michael Kitsis. Welcome, everyone.
0:28.7	Welcome to the 169th episode of the Financial Advisor Success podcast. My guest in today's podcast
0:34.7	is Alexandra Levy. Alex is the founder and managing partner of Element Financial Group, a hybrid RAA with the Commonwealth
0:41.0	platform that oversees nearly 430 million of assets under advisement for 170 clients.
0:47.6	What's unique about Alex, though, is that as a firm providing both investment management
0:51.4	and financial planning services, and that in fact she's been able to grow her revenue to be almost 50-50 between the two with a four to $11,000
0:59.2	a year annual retainer fee for financial planning, and that she did so specifically as a strategy
1:04.5	to combat the risk of fee compression by more clearly and separately articulating the value of
1:09.9	and the price of each service.
1:12.8	In this episode, we talk in depth about Alex's approach to financial planning and how she prices
1:17.6	it with her clients. The way she does a demo of eMoney advisor's dashboard in her prospect
1:22.4	meetings with potential clients to show them the way she'll keep their lives organized on an
1:26.2	ongoing basis. The way Alex shortened the upfront financial planning process with clients to show them the way she'll keep their lives organized on an ongoing basis.
1:31.9	The way Alex shortened the upfront financial planning process with clients to just two meetings,
1:36.6	but then conducts ongoing quarterly meetings with all clients in recognition that financial planning is much more about the ongoing planning process than the upfront plan itself.
1:41.2	And how thanks to technology Alex's quarterly meetings with her clients have increasingly
1:45.2	become virtual leveraging video conferencing software, but how the reduction in physical in-person
1:50.6	meetings hasn't impeded her retention rate that remains in the high 90s for her multi-thousand
	...

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