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February 22, 2017 at 12:43 PM
First Ascent Asset Management announced on Wednesday that it will begin offering advisors who use its outsourced portfolio management strategies a flat fee of $500 per account, regardless of the size of the account. The flat fee schedule is available for all new and current accounts.
When First Ascent launched in June, it capped fees at $1,500 on discretionary accounts and $1,000 on nondiscretionary accounts. However, Scott MacKillop, founder and CEO of First Ascent, said a flat fee was always his goal.
“We always had in mind that someday we would like to get to a flat fee,” he told ThinkAdvisor on Wednesday. He said his firm started experimenting with a flat fee scheme at the end of 2016.
(Related: The Dead Horse Bounce. And Another Thing About Flat Fees…)
“It was originally intended to just see if we could take some advisors who were going a little slow and get them to open some accounts with us,” he said. After getting a positive response from those advisors, the firm decided to offer flat fees to everyone.
“It seemed to resonate with advisors so we decided to just go with it. We did a little financial modeling to make sure it was something that was viable at this point in our history, and it looked like it was,” MacKillop said.
