The Impact of Pricing Strategies

Advisors can choose between bundling fees for investment management and financial planning or charging separately for these services, and current research suggests that separate charging often leads to higher overall fees. Bundlers tend to aggregate their services into a single fee, which can result in undervaluation of the planning aspect of their work. In contrast, firms that separate their planning fees tend to establish clearer value propositions, allowing them to charge higher AUM fees as well. This indicates that advisors who confidently articulate the worth of their services can leverage their pricing structure effectively to enhance revenue.