Can someone give you good financial advice at $200 a year? That is maybe 1-2 hours worth of advice including reviewing your portfolio and meeting up with you. Some plumbers charge more than that rate. If they are any good, they could probably make more money with better use of their time.
Patrick's numbers seem way off from my knowledge of what is typical in the industry. Typically a fee-only who deals with smaller clients will be around $150-$200 a month for people under $1m[1]. At the higher level of assets someone will likely charge in the thousands for a single session. It is not flat across the board. A $50m nest-egg is often much more complex compared to someone who wants advice at the $50k level.
It is not unusual for someone with $50m to pay $10-30k just for an initial session with a firm they are considering working with and then more ongoing. Many of these people wouldn't even consider working with someone who doesn't charge that as they will immediately assume you are not experienced or skilled enough to handle their needs.
As with any business, customers often expect to get what they pay for, and pricing to your market is important.
No one is disputing that are plenty of expensive advisors out there. The question is whether they actually provide any additional value over a 2 hour meeting with a financial planner and a computer-managed index fund.
I get the sense that there are many in this thread who are either in the industry or have been convinced to drink the koolaid themselves. I'm seeing lots of handwavey talking points but no substantial data-supported explanations for why the high priced advisors are anything more than gifted salespeople.
What I'm saying is that even "inexpensive" fee-only advisors, as Patrick is suggesting to, are closer to $1-2k/year not $150. I said nothing about the relative value of a 2 hour meeting with a financial planner, I am only stating the fact that you are unlikely to find any "fee-only" planner who will work with you for $150. I'd be happy to be proven wrong by someone who is actually doing it.
As my own counter example I know someone who did exactly as you suggested. A one time meeting with an advisor to review his portfolio and asset allocation but invests for himself online. It took about 2 hours and cost $500 and didn't include any detailed financial planning (e.g., taxes, retirement projections, etc.) it was simply a portfolio review.
So even using the lowest and simplest example I could find the cost is much higher than suggested. Additionally, I was also told this advisor was fairly reluctant to even offer this. This, generally speaking, just isn't their model. Even in the fee-only market they are typically looking to work with people on an ongoing basis, not one off.
As a more general example, in Canada some people work with "money coaches" who focus more on financial planning, saving habits, debt consolidation, retirement income planning, etc. They charge around $1-2k for a four meeting package. My understanding is that these prices are similar in the US but I could be wrong.
The bottom line here is that I'm just not aware of a market of financial advisors charging one time fees anywhere near $150. That's just how it is.
>> I get the sense that there are many in this thread who are either in the industry...
I suppose finance must be the one industry where people outside of it know much more than those in it.
