These Related Stories
Share this
Quoting a new planning fee to a prospect is one thing. Explaining a higher fee to someone who has trusted you for years can feel much more personal.
You remember when they first signed on. Maybe they took a chance on your firm when you were still building it. You appreciate that relationship, and you want the price to feel fair. Meanwhile, the work you do for them may look very different from what you originally agreed to provide.
It's easy to say you'll revisit your fees once your firm is established. It's harder to make that change when an introductory price has become a longstanding expectation.
If your earliest clients are still paying your earliest prices, you don't have to choose between appreciating their loyalty and building a sustainable firm. You do need a clear reason for the change and a thoughtful way to talk about it.
I'd start with those relationships: what you're providing now, what the fee supports, and how to give clients a fair opportunity to consider a new arrangement. There's also a lesson here for advisors setting their first fees, because today's starting price can become tomorrow's difficult conversation.
Look Closely at Your Earliest Client Relationships
If your current fees no longer fit, I wouldn't begin by applying the same percentage increase to every client. I'd start by understanding the gap.
Review what each household pays, what you agreed to provide, and what you're delivering now. Include preparation, follow-up, implementation support, and work between meetings. You may find that an outdated fee is the issue. You may also find that the service has expanded beyond its original scope.
Pay particular attention to the clients whose fees you've kept unchanged while adjusting prices for new relationships. Is that difference an intentional loyalty benefit you can afford, or a decision you've kept postponing?
Those situations call for different decisions. One might warrant a fee adjustment. Another might require clearer boundaries or a different service offering. A deliberately reduced-fee relationship can also remain part of your business if you've planned for it.
The goal is to make those choices consciously. Appreciating a client's loyalty doesn't require leaving their fee untouched indefinitely, and changing the fee doesn't erase your appreciation.
Recognize Their Loyalty Without Promising the Same Price Forever
Your earliest clients helped your firm get started. It's reasonable to want that history reflected in how you treat them. A personal conversation and ample time to consider a change can recognize the relationship without committing you to an indefinite discount.
If you choose to retain a loyalty discount or phase in an increase, define the amount and duration, assess whether the arrangement is financially viable, and review it with your compliance support. Make it a deliberate part of your pricing rather than an open-ended exception.
I'd also avoid treating every lower-fee relationship as a problem to solve. You may intentionally reserve capacity for clients who couldn't otherwise access your services. The question is whether you've made room for that commitment in your business plan.
Give Clients a Clear Explanation and Time to Consider It
Once you've decided on a change, prepare the explanation before sending the notice. Be specific about the new fee, when it would take effect, the services it covers, and the steps the client needs to take.
If you've added services, explain what changed. If you're aligning an older fee with your current pricing for the same work, say that plainly. You don't need to create a new deliverable simply to make the conversation feel easier.
A starting point for that conversation might be:
“I've reviewed our ongoing planning services and pricing, and I'd like to talk through an adjustment to your annual fee. The proposed fee is [amount], beginning [date], for [scope of service]. I appreciate the trust you've placed in me, and I want to give you time to review the change and discuss whether it continues to fit your needs.”
Adapt that language to the relationship and your firm's requirements. Before implementation, work with your compliance support to confirm the applicable agreement, disclosure, notice, consent, and billing steps.
Give clients room to ask questions. If the new arrangement doesn't fit their needs or budget, consider whether you have an appropriate alternative and how you can support a thoughtful transition. You can stand behind a sustainable fee while respecting the client's decision.
Price for the Service You Intend to Sustain
When you're launching, getting the first few clients can feel like the immediate priority. A lower fee may seem easier to explain, especially when you're still getting comfortable describing your value.
But the price that feels easiest to offer today deserves a second question: Will it support the work you intend to deliver when your firm is at full capacity?
The right price depends on your clients, service scope, costs, and business goals. Running that calculation can show whether your plan requires more households than you want to serve, leaves too little room for support, or depends on raising everyone's fees later.
Before settling on a fee, work through:
- The ongoing work included in the relationship, beyond scheduled meetings
- The number of households you can serve well within your preferred schedule
- The revenue needed to cover business expenses, compensate you, and fund planned support
- How the fee fits your intended clients and the service they need
For me, I'd rather see a firm review its pricing regularly than wait until the owner feels forced to make a substantial correction. A review doesn't have to result in an increase. It gives you a chance to check whether your fees, services, and capacity still work together.
Put that review alongside your annual business planning. Revisit the assumptions behind your original pricing, including how many clients you want to serve and what it takes to support them well. For new engagements, explain how future fee reviews and changes will be handled, in a manner consistent with your agreements and compliance requirements.
If you're choosing your first planning fee, give yourself permission to use the number your business plan supports, even if a lower number feels easier to offer. If you're revisiting an existing fee, bring a clear rationale and a thoughtful process to the conversation.
Your pricing should make it possible to keep doing the work your clients hired you to do, in a firm you want to keep running.
Share this
Subscribe by email
Creating a Business Plan for Your Financial Planning Practice
Creating a Business Plan for Your Financial Planning Practice
Technology Risk Management for Financial Advisors: Building a More Resilient RIA
Technology Risk Management for Financial Advisors: Building a More Resilient RIA
Protecting Your Practice: A Guide to E&O and Beyond for Independent RIAs
