Week 37

A Niche May Require a Creative Fee Structure

Pre-retirees and retirees are a popular client type for RIAs because they fit well into the AUM model. But when you specialize in a niche, you may find the traditional AUM fee structure doesn’t work for your prospects. For example, business owners who are starting to plan for the sale of their business may not meet your investable asset minimums today but will have a windfall in three to five years. Or perhaps you work with attorneys who are more comfortable paying a retainer because that is how they charge their own clients. When working with a niche, you may need to adopt a creative fee structure to monetize the opportunity your niche presents.