When Is Ongoing Advice-Only Financial Planning Worth It?
In my last blog post I looked at the cost of ongoing advice-only financial planning compared to more traditional assets-under-management advice models. I used that comparison because they are more comparable in terms of fees and service: both are meant to provide ongoing proactive support, just paid for differently.
Let’s first define Ongoing Advice-only planning as an annual retainer agreement where the planner supports the client in identifying, measuring, and executing on their financial goals but does not sell any products, manage investments, or take a percentage of those investments. Instead the client pays directly for an annual retainer. The alternative (and popular) model is a project-based fee, for a fixed timeline and set of deliverables or hourly support.
From a planner’s perspective, a recurring relationship is obviously attractive. It creates continuity, makes deeper planning possible, and avoids constantly needing to find new clients. But from a client’s perspective, the more important question is whether ongoing advice is actually the best value.
Over the past several months my perspective on this has sharpened. I do not think everyone needs ongoing financial planning. The hypothetical couple in my last case study likely could have done well with a focused planning engagement and then revisiting things periodically as life changed. Ongoing advice has real benefits — financial and emotional — but those benefits need to justify the ongoing cost.
So who benefits most from ongoing planning? I think the case gets stronger when one or more of the following conditions are present:
There is complexity and choice
You are in or approaching a major transition
The stakes are high
There is significant follow-through or behavioural change required
1. There is complexity and choice
If your income, expenses, and savings are relatively stable and your key risks are protected (insurance, wills etc.) then for a period of time aligning on a targeted savings rate, sticking to it, and investing in low-cost globally diversified funds might be all you need (kind of like a doctor’s or mechanic’s visit, save X$ per year into account Y and check back in 3-5 years or if something big changes).
Others have “complexity factors” that allow for greater degrees of freedom in where they choose to save, spend, invest etc. some of these include:
Flexibility in determining your income and sources of income (e.g. business owners, pension deferrals, retirees withdrawing from RRSPs/RRIFs, realizing gains on investments, deciding if/when to claim certain government benefits)
Weighing paying down significant debt against non-registered investments or savings
Variable income either through business ownership, sales commissions, bonuses, stock-based compensation, trust distributions, or inheritances
Education savings for children or large infrequent purchases
Disabilities, or leaves of absence from work in the family etc.
Defined benefit pensions and the option to purchase leaves of absence(s), take a new role etc.
The “right advice” for handling these situations is very personal and can evolve over time, even for the same person. Once there’s enough complexity at play, an integrated and consistently updated financial plan becomes increasingly valuable both financially and psychologically. Each time a planner “picks up your file,” there’s a fixed cost in time and money to get re-familiarized. If you have enough complexity and enough decisions, it may be more cost effective to have someone who knows your situation cold and is working proactively to help you meet your goals faster.
2. You are in or approaching a major transition
Planning is often the most impactful on both ends of major life transitions
Some common examples include a career change, starting or selling a business, buying or selling a home, receiving an inheritance, giving money to children, approaching retirement, losing a spouse, or deciding to work less.
These moments often create clusters of important decisions, and those decisions are not always purely financial. They can be emotional, personal, and time-sensitive. It’s also in these periods of transition that we often gain more clarity about our goals and what really matters (which should be reflected in your financial plan).
Retirement is probably the most common example. The question is rarely just “can I retire?” It is usually some version of: “what would make me comfortable enough to actually start spending the money I saved?” The math matters, but so does the personal side. How much flexibility do you want? What would make retirement feel successful? How would you feel if you had to change your spending during retirement or downsize your home? How much do you want to preserve for the next generation?
This is why “approaching” a transition matters. Waiting until after the transition has happened can mean some decisions are already constrained.
3. The stakes are high
This one is somewhat intuitive, but it is also a feature of a largely fixed-fee business model. If a family with a net worth of $3 million, or a household income of $300K+, is paying a ~$4K annual advice-only planning fee, it is often easier to find tax, investment, or behavioural opportunities that more than cover the cost of the fee. While I have seen a few high-value, low-income planning opportunities (often centered around government benefits) they are usually best served by project based work.
High-stakes decisions often overlap with transitions and complexity, but not always. A household with a large taxable portfolio, the opportunity to buy back pensionable service, significant corporate assets, or meaningful annual surplus may have ongoing planning opportunities even if life is otherwise fairly stable.
4. There is significant follow-through, behavioural change, or education required
This may be the most underestimated source of value in ongoing planning. Many people roughly know what they should be doing: save more, spend more intentionally, simplify investments, reduce unnecessary taxes, update estate documents, review insurance, or make the decision they have been putting off. But the issue is not always knowledge. Sometimes it is confidence, behaviour, or follow-through.
One area I have seen this clearly is with very good savers approaching or entering retirement. On paper, the math may show that they can afford to spend more, retire earlier, help children, travel, or make a meaningful gift. But after decades of saving and being careful, actually using the money can feel uncomfortable.In those cases, the planning work is not just about proving that the money is there. It is about helping clients build enough confidence in the plan to change behaviour.
Education can create a bit of a flywheel here. As clients better understand their situation, they often become more confident. As they become more confident, they can become more ambitious and creative with their goals. Instead of simply asking “are we okay?” the conversation can shift toward “what do we actually want this money to do”? That can lead to much better use of money. Not necessarily more spending for its own sake, but more intentional spending, giving, lifestyle design, or risk-taking where it actually aligns with the client’s goals.
There is also the practical implementation side. A good plan can still fail if the actions do not happen. Beneficiary designations need to be updated. Estate documents need to be reviewed. Investment accounts need to be simplified. Cash flow systems need to be set up. Corporate and personal planning may need to be coordinated with an accountant. None of this is especially glamorous, but it matters.
For some clients, the value of ongoing planning is not that we uncover a brilliant new strategy every year. It is that there is a structure in place to keep moving the important things forward, while continuing to refine the plan as their understanding and goals evolve.
In summary ongoing Advice-only planning is most valuable when the plan (or your life) is unlikely to stay static
If your situation is evolving, the decisions are meaningful, or the real work is turning good intentions into action, then ongoing planning can be worth exploring. If not, a focused engagement and revisiting things as life changes may be the better fit.
At Gybe, the goal is not to make every client an ongoing client. The goal is to match the planning relationship to the situation. If you would like help figuring out what level of support makes sense for you, you can book a complimentary introductory video call here.