Our clients pay three kinds of fees: fees to us, fees to a custodian to do transactions, and fees to a mutual fund company to manage the funds.

Our Fees

Annual fee for our combined service of financial planning and portfolio management:

  • 0.75% of portfolio assets up to $2,000,000
  • 0.50% of amounts from $2,000,001 – $5,000,000
  • 0.25% of amounts over $5,000,000

Minimum portfolio size of $1,000,000

Custodian Fees

Our main custodian is Charles Schwab. Schwab has both mutual funds for which they do not charge a transaction fee and funds for which they do charge a fee. Most of the funds we use, and especially those from Dimensional Fund Advisors and Vanguard, are transaction fee funds.

We use these types of funds because it is better for our clients. Schwab charges a fee of some amount directly to the portfolio for those funds for which they do not charge a transaction fee. Schwab after all is not in the business of working for free. Both Vanguard and DFA have studied the merits of transaction fees (so much per trade) vs. portfolio based fees and have decided that for long term investors who trade infrequently the transaction fee method is much cheaper – and we agree with this.

In a “typical” year our “typical” client pays about 0.07% in these fees depending on the number of deposits and withdrawals. We believe the fees purchase a level of service that makes them well worth paying.

Fund Fees

The mutual funds we use also charge fees – management fees – and they also have various other kinds of expenses. Our clients pay these fees indirectly because they are deducted prior to reporting results. We use passively managed funds whenever possible. Fees on passive funds are generally lower than those of their active counterparts. Our “typical” client pays about 0.42% in fund fees. See our Investor Resources page for links to DFA and Vanguard where actual costs can be found.