Questions to ask
Pricing/Payout.
Payout Grid
The headline payout percentage rarely tells the full story. Advisors should understand exactly how the payout grid works before comparing firms.
- What is my actual payout percentage based on my current production, not just the advertised top-end payout?
- What production levels or asset levels are required to move into higher payout tiers?
- Which revenue types count toward the payout grid, and which revenue types are excluded or treated differently?
- Are the payout tiers based on gross dealer concession, advisory revenue, recurring revenue, household assets, or another metric?
- Can my payout percentage be reduced because of product type, affiliation model, account size, supervision requirements, or firm policy?
Platform Fees
Platform fees can quietly change the real economics of a move. Advisors should compare all asset-based and program-level charges before making a decision.
- What advisory platform fees apply to my client assets, and are they charged to me, the client, or deducted before payout?
- Do platform fees vary by account size, total advisory assets, program type, investment vehicle, or affiliation model?
- Are there additional admin, custody, technology, model, strategist, SMA, or program fees layered on top?
- How would these platform fees impact my net take-home on my actual book of business?
- Can clients see these fees directly, and could they affect how competitive my pricing looks after the transition?
Product Haircuts
A high payout may not apply evenly across every product. Advisors should know where payout reductions may occur before projecting income.
- Are there payout haircuts on annuities, alternatives, insurance, 529 plans, cash, brokerage, or other product categories?
- Which parts of my current revenue would receive full payout, and which parts would receive a reduced payout?
- Are product haircuts temporary, permanent, negotiable, or tied to supervision and compliance requirements?
- How would product haircuts affect my actual annual income based on my current revenue mix?
- Are certain legacy products, direct business, trails, or outside-held assets treated differently after transition?
Ticket Charges
Trading and transaction charges can matter a lot depending on how the advisor manages portfolios. The right comparison depends on actual trading behavior.
- What ticket charges apply to ETFs, mutual funds, equities, fixed income, UITs, options, and other securities?
- Are ticket charges paid by the advisor, billed to the client, or absorbed by the platform?
- How often would my current trading style trigger transaction costs?
- Are there no-transaction-fee fund lists, participating ETFs, or platform-specific options that could reduce costs?
- How would these charges affect my net economics if I rebalance frequently, trade individual securities, or use fixed income?
Affiliation Cost
The highest payout model may also require the advisor to absorb more business expenses. Advisors should compare net income, not just payout.
- What fixed annual costs would I be responsible for, including E&O, technology, compliance, licensing, platform access, and administrative fees?
- Which expenses are included in the affiliation model, and which expenses become my responsibility?
- Would I need to pay for office space, staff, marketing, CRM, financial planning software, phones, cybersecurity, or outside vendors?
- How do these fixed costs change as my practice grows or as I add advisors, staff, locations, or additional business lines?
- After all affiliation costs, what is my realistic net take-home compared to my current firm?
Account Fees
Account-level fees affect the client experience and can create friction during transition. Advisors should know what clients may be charged before moving.
- What account-level fees could my clients pay, including IRA fees, small-account fees, termination fees, advisory program fees, or maintenance charges?
- Are there household minimums or account minimums that could impact smaller relationships?
- Which fees are waived, negotiable, client-billed, advisor-paid, or automatically deducted?
- How would the new fee structure compare to what my clients are currently paying?
- Could any account fees create transition friction, client objections, or pricing pressure after the move?
Payout Schedule
Even when annual economics look attractive, short-term cash flow can get messy during and after transition. Advisors should understand timing clearly.
- When will revenue begin paying after the transition, and are there any expected delays?
- How often are advisory fees billed and paid out: monthly, quarterly, in arrears, or on another schedule?
- How are trails, commissions, advisory fees, and recurring revenue handled during the first few months after transition?
- Will there be any temporary cash-flow gap while accounts transfer, advisory agreements are signed, or billing cycles reset?
- How should I plan for payroll, staff expenses, office costs, taxes, and personal income during the transition period?
TA vs. Payout
A bigger transition package is not always the better economic decision. Advisors should compare upfront money against long-term net economics.
- How much am I gaining upfront versus how much I may give up annually through lower payout, higher platform fees, or higher expenses?
- What is the 3-year, 5-year, and 10-year net economic comparison between each firm or affiliation model?
- Does the transition assistance create repayment risk, reduced flexibility, or a longer commitment than I am comfortable with?
- At what point does a higher ongoing payout outweigh a larger upfront transition package?
- Which option gives me the best combination of upfront capital, long-term income, client experience, and enterprise value?
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