Understanding Your Costs and Value Proposition

Before you can decide how much charge financial planning, you must first understand your own business costs and the tangible and intangible value you deliver.

1. Calculate Your Costs: Go beyond just your salary. Factor in all your overhead: office space, technology (CRM, planning software, trading platforms), staff salaries, marketing, insurance, compliance, licensing, and continuing education. Divide these annual costs by the number of billable hours or clients you can realistically serve to understand your baseline cost per client or hour.
2. Define Your Unique Value: What specific problems do you solve? Do you specialize in physicians, tech executives, pre-retirees, or families with special needs? Your expertise, experience, and the specific outcomes you help clients achieve (e.g., early retirement confidence, tax optimization savings, smooth intergenerational wealth transfer) are key components of your value. Quantify this value where possible. For example, if your tax strategies typically save clients X% per year, that’s a clear value metric.
3. Know Your Target Client: Different clients have different needs, complexity levels, and capacity to pay. Pricing for a high-net-worth family with complex estate planning needs will differ from pricing for a young professional starting their wealth journey. Segment your audience and understand what they perceive as valuable.

Common Pricing Models for Financial Planning

Historically, AUM (Assets Under Management) has been the dominant model in wealth management, but it doesn’t always align with the value of pure financial planning, especially for clients with significant income but limited current assets, or those primarily needing advice on topics like cash flow, debt, or employee benefits.

Here are the common models and their relevance to financial planning:

• AUM Fee: A percentage of assets managed (e.g., 1% on the first $1M). While simple for investment management, it can underprice or overprice financial planning depending solely on asset size, not planning complexity.
• Hourly Rate: Charging a fixed rate per hour worked (e.g., $150 - $400+ per hour). This is transparent but can penalize efficiency, is hard to estimate upfront, and clients often dislike the unpredictable final cost. It doesn’t easily capture the value of advice, only the time spent.
• Fixed Fee: Charging a set price for a defined scope of work (e.g., $2,500 for a comprehensive one-time financial plan). This provides cost certainty for the client and rewards advisor efficiency, but requires clear scope definition.
• Retainer or Subscription Fee: Charging a recurring fee (monthly or annually) for ongoing access to planning services and regular check-ins (e.g., $150 - $500+ per month). This fosters a long-term relationship, smooths revenue, and aligns well with the ongoing nature of financial planning needs. This model is growing significantly in popularity for planning-focused firms.
• Value-Based Pricing: Pricing based on the perceived value or outcome delivered to the client, rather than just costs or time. This is often the most profitable model but requires clearly articulating and demonstrating value. It frequently translates into fixed or retainer fees structured around specific client segments and the value delivered to them.

Determining Your Specific Financial Planning Fee

So, how much charge financial planning specifically? There’s no single answer, but you can arrive at your right price by considering:

1. Your Costs + Desired Profit Margin: Use your cost calculations. If your cost per client is $1,000 annually, you need to charge significantly more than that to be profitable. Aim for a healthy margin reflective of your expertise.
2. Market Benchmarks: Research what other advisors with similar experience, specializations, and target clients are charging in your region. Look at fee-only advisor networks or industry surveys. As an example, an initial comprehensive financial plan might range from $2,500 to $7,500+ depending on complexity, while ongoing retainers could be $150 to $500+ per month or $2,000 to $6,000+ annually. These are just illustrative examples and vary widely.
3. Client’s Perception of Value: What is solving their problem worth to them? A client saving $10,000+ annually through tax planning or avoiding costly financial mistakes might happily pay a significant fee.
4. Service Packaging and Tiers: Instead of one price, offer tiered packages (e.g., Basic, Comprehensive, Premium) or modular pricing with optional add-ons (like estate planning deep dive, business planning). This allows clients to choose the level of service that best fits their needs and budget, and can increase your average deal value.

Combining these factors allows you to arrive at a price that covers your costs, is competitive, and reflects the true value you provide. Don’t be afraid to charge what you’re worth.

Presenting Your Pricing Confidently and Clearly

Once you’ve determined how much charge financial planning, the next critical step is presenting your fees to clients in a way that is transparent, professional, and reinforces the value. Avoid sending a confusing list of services and a single number.

Consider the client experience:

• Frame the Price: Present your fee after thoroughly discussing the client’s needs and how your services will address them. This anchors the price against the value you’ve established.
• Offer Options: If you have tiered packages or add-ons, present them clearly. This isn’t about overwhelming the client, but empowering them to choose what’s right for them.
• Use Modern Tools: Moving beyond static PDFs or spreadsheets for pricing can significantly enhance the client experience. Interactive pricing tools allow clients to explore options, see how fees change based on their selections, and understand exactly what’s included. This builds trust and confidence.

For a modern, interactive way to present your service packages, tiers, and ongoing fees, consider a tool like PricingLink (https://pricinglink.com). It lets you create configurable pricing links that clients can interact with, making complex options easy to understand and speeding up the decision process. PricingLink is designed specifically for presenting pricing in a clear, modern way, different from all-in-one solutions.

It’s important to note that PricingLink is focused only on the pricing presentation and lead capture step. It does not handle full proposals with e-signatures, contracts, invoicing, or ongoing client management. If you need comprehensive proposal software with these features, you might look at tools like PandaDoc (https://www.pandadoc.com) or Proposify (https://www.proposify.com). Larger wealth management platforms like eMoney Advisor (https://emoneyadvisor.com) or Orion Advisor Solutions (https://www.orion.com) also offer broad suites of tools which may include basic proposal features, though typically not the interactive pricing configuration PricingLink specializes in. However, if your primary goal is to modernize how clients interact with and select your pricing options before the full proposal/contract phase, PricingLink’s dedicated focus offers a powerful and affordable solution starting at just $19.99/mo.

Implementing Your New Pricing Strategy

Transitioning to a new pricing model or simply increasing your fees requires a plan:

1. Update Your Service Descriptions: Clearly define what’s included in each package or service level.
2. Train Your Team: Ensure everyone who interacts with clients understands the new pricing structure and can articulate the value.
3. Communicate with Existing Clients: Decide how you will handle pricing changes for current clients. Phasing in changes or offering to transition them to a new model at their next review period is common.
4. Standardize Your Onboarding: A clear, consistent onboarding process reinforces the value and sets expectations after the pricing conversation is complete. This is separate from pricing presentation but crucial for delivering the value you priced.