SMARTlight

Tom Titus, SMART Concepts Group CEO

There is little doubt that margins will continue to compress.  One industry stalwart predicts a 35 basis point “new norm” average asset management fee.  While I agree that fee compression will continue, this extreme level precludes nearly all personalization and it is this aspect upon which I diverge.  I do not foresee a complete consumer severance of the advisor-client relationship.  Rather, the practitioner must evolve and align to a “new norm” range of 65 to 95 basis points. Consumers face far too many financial complexities, decisions, and generally have too much life in the way to render the advisor-client relationship inconsequential.  However, practitioners offering strategic team solutions will find themselves at or near an average asset management fee of 95 basis points.  No matter the range, it’s the end of an era for percentage based compensation structure.  There is no doubt that your paradigm must change to meet the demands of the consumer, industry, and regulatory bodies.

A financial firm’s evolution begins with a candid assessment of ownership, team, affiliation(s), services, and growth strategies.  SMART Concepts Group is holistic in that we have the essential tools and techniques to help practitioners design a team solution and then take it full circle with turnkey implementation of the optimal business model, must-have legal documentation, supported by our propriety valuation process.

The new norm is fast approaching, are you prepared?

“It’s the end of an era for percentage based team compensation structure. There is no doubt that your paradigm must change to meet the demands of the consumer, industry, and regulatory bodies.”