Step 3 – The Real Cost of Complexity
When we conducted a full audit of the family’s portfolio, the most jaw-dropping figure wasn’t performance-related. It was the fees: $330,000 per year. And they weren’t even getting full value for it—until we began restructuring fees to reflect the actual value being delivered.
That amount was spread across three advisors, each charging 0.75% to 1.10%, plus embedded mutual fund fees, layered custodial fees, and overlapping mandates.
This lacks economies of scale. Misses out on tax deductibility. Fails to align incentives.
Step Three: Realign the Structure, Cut the Cost
We didn’t just renegotiate, we redesigned.
| Asset Class | Old Fee | New Fee | Old Cost | New Cost |
| Canadian Equity | 1.00% | 0.525% | $45,000 | $23,625 |
| US Equity | 1.00% | 0.525% | $45,000 | $23,625 |
| International Eq. | 1.10% | 0.07% | $33,000 | $2,100 |
| Fixed Income | 1.10% | 0.50% | $99,000 | $45,000 |
| Real Estate | 1.20% | 0.75% | $54,000 | $33,750 |
| Alternatives | 1.20% | 0.75% | $39,000 | $22,500 |
| Cash | ~0.50% | 0.00% | $15,000 | $0 |
Total:
- Before: $330,000/year
- After: $150,600/year
- Savings: $179,400/year
How We Did It
- Consolidated equity mandates under a transparent custodial platform at 0.425%, plus our 0.10% oversight
- Transitioned the fixed income mandate to one advisor willing to price at 0.50% and who actually increased their total compensation by growing their share of assets
- Eliminated mutual funds with embedded fees
- Streamlined reporting and oversight across fewer people and platforms
More Than Just Savings
By realigning who managed what, we achieved:
- Simplified communication and oversight
- Better accountability
- Tax-deductible advisory fees
- Transparency that allows for real benchmarking
The Takeaway
High fees don’t always signal better service. In fact, they often hide in plain sight layered inside outdated products and entrenched relationships. Restructuring fees through a proper audit can uncover these inefficiencies and, when done right, pay for itself many times over.
Are your advisors earning what they charge or just charging what they always have?
Next up: Step 4 – Income That’s Built to Last
For a full look at the transformation, see our case study: When Diversification Backfires, Streamlined Stewardship Steps In
