Raising Your Fees Won't Leave You Homeless

One such area was raising my fees, which, on the surface, is daunting. We all face “head trash” around addressing our fees with our clients.

Some of you will argue against the morality of receiving anything more than a pittance in payment. But it’s in my client’s best interest to pay me well for the value I deliver.

My clients know that if, at any point, they feel that the service my firm provides is not worth some multiple of their fee, they are more than welcome to part ways as friends.

Yet, they’re all still here – and making referrals.

For those who may have procrastinated raising your fees for the last decade, here’s your sign to take the leap in 2024.

You won’t lose your clients

I know you’d rather puke in a stained truck stop toilet than tell your clients you will start charging them more. After all, your existing clients have already agreed to pay you a set amount each quarter. They may not be thrilled to see that number increasing.

It's natural for your mind to race to the worst-case scenario when we broach the “fee conversation.”

But your clients won’t leave you.

Your team won’t leave you. Your family won’t leave you. You won’t find yourself living in a van down by the river or stumbling through grocery store parking lots in a tattered suit holding a cardboard sign with “will create financial plans for food” scribbled across it in Sharpie.

That’s just not going to happen.

If you deliver massive value to your clients, you’ll find that most – if not all – of them will gladly sign along the line for your new service agreement because they see your value.

When you raise your fees, you will experience a tremendous boost in confidence and bolster your ability to deliver even more value.

This may sound a little convoluted, but paying a premium fee benefits your clients in several ways.

1. You need to see fewer clients to reach your revenue goals

I have a competitor whose business is across the street from my firm. Out of morbid curiosity, I pulled up advisor Bob’s ADV to find that he has 600 clients, many times what my firm has. Yet we have the same revenue.

I thought getting on my calendar was rough; Bob’s clients must wait two years for a Surge appointment. My clients get to see me at least twice in a single year.

Bob has to serve three times more clients than I do to bring home the same amount.

Take a moment for that to sink in.

Because I have fewer clients, I have more time to focus on them. With fewer seats taken on the bus, each client gets more attention.

Every quarter, each client receives value adds specific to their needs and financial situation. And every quarter, my clients see my face and hear my voice. They know I’m in their corner and am available to help them through life-changing events with little notice.

I doubt Bob has the flexibility to do that.

2. Gain more opportunities for professional development

Being paid well for your service and serving fewer clients opens more personal and professional development (PD) possibilities.

An increased PD budget allows you to work with higher-caliber coaches who will teach you how to reach the next level. The effects of your coaching and subsequent personal growth will trickle down to every aspect of your practice.

You’ll become a better leader for your team. You’ll inspire them to follow through with the difficult transitions that growth demands and help them serve clients more effectively.

You’ll have more confidence in your financial planning and instill in your clients more confidence in your planning abilities. Your clients will be more likely to follow your direction when markets go south.

3. Healthier profit margins will future-proof your business

Discounting fees leads to failing practices that offer your clients no future value. How will you serve them if you’re not making enough to keep the lights on or have to take out a loan to make payroll?

Healthy profit margins increase your business stability and growth. Having a profitable practice ensures that you’ll be around to serve your clients and their families for decades to come.

There’s nothing ethically wrong about getting paid for the value you deliver. Maybe you don’t see how raising your fees adds value from where you’re standing. But I’ve leaped and am standing on the other side.

My business partner, Micah Shilanski, CFP®, and I have coached hundreds of advisors who have jumped in after us to find the value in implementing Surge and incorporating value adds.

For advisors ready to take their practice to a higher level, raising your fees is the next step to building your perfect RIA and adding value to your clients.

We hope you’ll dive in after us.

Action Items

If you’re afraid to raise your fees, follow the Tim Ferriss approach and “fear-set” it.

Pull out a pen and a pad of paper and write down every single worry and concern you have about raising your fees. What is the worst-case scenario?

Work through why you’re so worried about why that could happen.

Even if you have a few clients who leave, it won't end your practice; you’ll come out better for it.

Matthew Jarvis, CFP®, ChFC, is the co-founder of The Perfect RIA, one of the industry's most recognized advisor training platforms. Just 10 years prior, Jarvis was buried in debt, with a badly struggling practice and a morning routine of trying to figure out how to quit the industry without looking like a failure. Through several turns of fate, Jarvis clawed from near failure to the top of the industry. Today, alongside running his incredibly profitable and successful practice, Jarvis guides other advisors on duplicating his success in their practice.

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