What is an ongoing service fee in advisory accounts?

An ongoing service fee in advisory accounts is a fee charged annually for the continuous management and advisory services provided to the client. This fee is typically structured as a percentage of the assets under management and is designed to compensate the advisor for their ongoing work, which includes portfolio monitoring, asset allocation adjustments, regular performance reviews, and client communication.

This model contrasts with one-time fees, which are not related to the continuous nature of the advisory relationship, nor does it pertain to transactional fees or commissions that only apply when trades are made. Instead, the ongoing service fee reflects the value of the advisor's continuous engagement and the strategic advice they provide over time, underscoring a more collaborative and supportive relationship between the advisor and the client.