Aligning Principles and Economics

Clients, we recently wrote about our quest to align our pricing with our values. The advisors of Leibman Financial Services service $50 million in advisory assets through LPL Financial. The fees charged could better reflect your contribution to investment results through effective investing attitudes and behavior. We are going forward with changes by year-end.

We believe that people can learn to frame things more effectively, to see the long term, to find out a temporary drop is NOT a loss. New clients usually require more intensive communication (and hand-holding, in some cases). It makes sense to charge them a little more, and reduce costs for you longer term clients.

For the vast majority of you, “heads you win, tails you don’t lose.” Generally, if the new schedule indicates a fee reduction, that will go into effect as soon as possible. If it shows an increase, we will leave the pricing the same. Current pricing is a hash, depending on when accounts were originally opened. So we will be communicating with each of you.

The new table rewards your persistence three ways.

1. A fee reduction after two years, shown in the table below.

2. Additional reductions after eight and sixteen years, about 3% to 6% depending on household account value.

3. The potential for assets to grow over time tends to put longer-term clients into higher value brackets, with lower fees.


In a few cases (particularly for newer clients), the table may indicate a higher fee than what we currently charge. Please do not be alarmed—we are not going to try to jack up our rates on anyone we are doing business with. Consider yourself grandfathered in.

Clients, with this project we have attempted to align our economics more closely with our values. We will be in touch about your specific situation. If you would like to discuss this or any other issue at greater length, please write or call.

Additional reading:

About learning to live with volatility: They Say You Can’t Handle the Truth

About discretion to act on your behalf: Freedom to Decide vs. Freedom to Debate

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results.

All investing involves risk including loss of principal. No strategy assures success or protects against loss.