Account termination fees

When a fee-based account transfers away, do firms have a provision for the "xx days written notice" where-in the fee continues to be collected? Or, a flat account termination fee? Or, any other account closing fees?

Comments

  • Hi Denise, Thought I would offer a simple answer -- this is about what you specify in your Form ADV and the advisory contract. Our firm does not collect closing fees or account termination fees. We charge a Quarterly fee for AUM in advance so the client receives a prorated refund based on the agreed upon termination date with the client (sometimes that is the asset transfer date). There is a fair amount of work involved when terminating so, while we don't charge term fees, I can see why an RIA might desire to do so.

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