Updated on July 3, 2026
Quick answer (2026): For AUM fee breakpoints 250k 500k 1m 3m comparisons, the breakpoints are the portfolio levels in a tiered AUM fee schedule or AUM fee schedule where an advisor’s percentage fee drops on the next slice of assets. For example, a schedule that charges 1.00% on the first $500,000, 0.80% on the next $500,000, and 0.60% above $1,000,000 costs about $9,000/year on a $1,000,000 portfolio and $21,000/year on a $3,000,000 portfolio before fund, platform, overlay, trading, tax-prep, or implementation costs. Run the same numbers through the financial advisor fee calculator if you want to compare the breakpoint quote against a flat annual, retainer, hourly, or project fee.
The key question is whether the lower rate applies by slice, like tax brackets, or to the full account balance. Do not compare the headline percentage alone. Compare the AUM fee schedule, AUM fee tiers, annual dollars, effective rate, fund and platform costs, written planning scope, implementation help, and whether a flat annual, retainer, hourly, or project-fee quote would be cheaper for the same work.
What that rate costs you, in your own dollars
Percentages are hard to feel. The same rate that sounds small as a number is a specific amount of money leaving a specific account every year, and it compounds against you because the dollars taken out stop earning. Enter your balance and the rate you pay or have been quoted, and this converts it into dollars.
You know where the breakpoints are. Now make one apply to you.
The tiers above are list price. Whether a firm actually moves you to the next breakpoint — or blends the rate across tiers — is negotiable, and the way to find out is to ask two or three firms the same question about the same balance.
Before you start, what actually happens. The matching service is run by WiserAdvisor, an independent advisor-matching company. It opens on their site, asks for your ZIP code and a few questions, and matches you with 2 to 3 vetted advisors. It is free to you.
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Compare the breakpoint schedule in dollars
Before you accept an AUM breakpoint schedule, ask whether each tier is billed by slice, what the effective annual dollar cost is, and whether the same scope is available for a flat annual quote or dollar cap.
Tool path: AUM Fee Calculator (model the tiers) - Financial advisor fee calculator (compare models) - AUM Fees by Balance (compare portfolio sizes) - Flat Fee vs AUM Break-Even (find the crossover).
Fast tools: AUM Fee Calculator · AUM fee meaning · Financial advisor fee calculator · Compare financial advisor rates · Find a Financial Advisor · fee-only financial advisor near me · fiduciary financial advisor near me · Flat Fee vs AUM Break-Even · Flat fee vs AUM examples · AUM fee examples · AUM Fees by Balance · AUM Fees at $1M · Average Financial Advisor Fees
Next step: Use the calculator path above to compare the breakpoint schedule against flat annual, retainer, hourly, and project quotes before a second call.
What is an AUM fee breakpoint?
- Breakpoint: the asset level where the next portion of the portfolio receives a lower advisory fee rate.
- By-slice rate: each rate applies only to that slice of assets, similar to tax brackets.
- Whole-balance rate: one rate applies to the entire portfolio after a breakpoint is reached.
- Effective AUM rate: total annual advisory dollars divided by the full managed portfolio value.
- All-in cost: advisory fee plus fund expenses, platform fees, overlay fees, UMA/program fees, trading costs, tax-prep costs, and implementation charges.
AUM fee breakpoints: by-slice example
Example schedule used below: 1.00% on the first $500,000, 0.80% on the next $500,000, and 0.60% above $1,000,000.
| Portfolio balance | Straight 1.00% AUM | By-slice advisory fee | Effective AUM rate | Savings vs straight 1.00% |
|---|---|---|---|---|
| $250,000 | $2,500/year | $2,500/year | 1.00% | $0/year |
| $500,000 | $5,000/year | $5,000/year | 1.00% | $0/year |
| $750,000 | $7,500/year | $7,000/year | 0.93% | $500/year |
| $1,000,000 | $10,000/year | $9,000/year | 0.90% | $1,000/year |
| $2,000,000 | $20,000/year | $15,000/year | 0.75% | $5,000/year |
| $3,000,000 | $30,000/year | $21,000/year | 0.70% | $9,000/year |
These are advisory-fee examples only. They do not include fund expense ratios, platform fees, overlay fees, trading costs, taxes, tax-prep costs, legal fees, or one-time implementation charges.
Common AUM breakpoint schedules to compare
| Schedule type | Example tiers | Where it often matters | Question to ask |
|---|---|---|---|
| Simple two-slice schedule | 1.00% first $500k; 0.80% above $500k | $500k–$1M portfolios comparing AUM against flat annual planning | Does the lower rate apply only above $500k or to the full balance? |
| Three-slice schedule | 1.00% first $1M; 0.80% next $2M; 0.60% above $3M | $1M–$5M portfolios where the effective rate should decline as assets grow | What is my annual fee in dollars at $1M, $2M, $3M, and $5M? |
| Planning-first lower schedule | 0.80% first $500k; 0.40% above $500k | Households comparing portfolio management against a flat annual or retainer quote | What planning deliverables are included at this lower rate? |
| AUM with minimum fee | 0.75% AUM subject to $6,000 annual minimum | Smaller portfolios where the minimum can create a higher effective rate | What is the effective percentage after the minimum fee? |
| Blended AUM plus planning fee | 0.60% AUM plus $3,000 annual planning fee | Complex planning relationships with both investment management and fixed planning work | Which costs are recurring, and what becomes hourly or out-of-scope? |
By-slice vs whole-balance pricing
Two advisors can quote the same breakpoint language but bill it differently. Always ask for the calculation in dollars.
| Billing method | Example on $2,000,000 | Annual advisory fee | What it means |
|---|---|---|---|
| By-slice tiers | 1.00% first $1M + 0.80% next $1M | $18,000/year | Lower rate applies only to the next slice. |
| Whole-balance lower rate | 0.80% × full $2M balance | $16,000/year | Lower rate applies to the whole portfolio after the breakpoint. |
| No breakpoint | 1.00% × full $2M balance | $20,000/year | One percentage applies to the entire managed balance. |
All-in cost after fund, platform, and UMA fees
A breakpoint lowers the advisory fee, but the all-in cost may still include ETF or mutual-fund expenses, platform fees, overlay fees, UMA/program fees, trading costs, tax-prep costs, or implementation charges. Treat the breakpoint as a cost-efficiency threshold, then compare the platform layer in AUM fees by balance and UMA platform costs. Ask for each layer separately.
| Portfolio balance | By-slice advisory fee | Fund cost at 0.06% | UMA/platform at 0.10% | All-in annual example |
|---|---|---|---|---|
| $500,000 | $5,000 | $300 | $500 | $5,800/year |
| $1,000,000 | $9,000 | $600 | $1,000 | $10,600/year |
| $2,000,000 | $15,000 | $1,200 | $2,000 | $18,200/year |
| $3,000,000 | $21,000 | $1,800 | $3,000 | $25,800/year |
Run your exact quote through the AUM Fee Calculator. To compare against flat annual, retainer, hourly, or project pricing, use the Financial Advisor Fee Calculator.
When AUM breakpoints may still fit
- You want ongoing portfolio management bundled with planning, rebalancing, and implementation help.
- The breakpoint schedule meaningfully lowers the effective rate as assets grow.
- The advisor’s written scope includes retirement income, tax-aware withdrawals, Roth-conversion windows, Medicare/IRMAA, RMDs, investment policy, estate-adjacent coordination, and taxable-account planning where relevant.
- Fund expenses, platform fees, overlay fees, and program costs are low and disclosed in annual dollars.
- The advisor will show your effective AUM rate and all-in annual cost before you sign.
When to ask for a flat fee, retainer, hourly project, or dollar cap
- The AUM quote creates a high annual dollar cost relative to the service calendar.
- You mainly need planning, a second opinion, a tax-window review, or a rollover/RSU/concentrated-stock project.
- You want a predictable annual dollar amount instead of a fee that rises automatically with assets.
- The proposal does not clearly state what is included, what is excluded, and what becomes hourly or out-of-scope.
- You have $1M, $2M, $3M, or more and the AUM fee is materially higher than a flat annual planning quote for similar deliverables.
Helpful comparisons: Flat Fee vs AUM Break-Even · Flat-Fee Financial Advisor · Hourly Advisor Rates · Average Financial Advisor Fees
Copy/paste: ask for the breakpoint schedule in dollars
Subject: AUM breakpoint schedule — annual dollars and effective rate Hi — I’m reviewing the proposed AUM fee schedule and want to compare it apples-to-apples against flat-fee, retainer, hourly, and project-fee options. Could you send a short written summary covering: 1) My annual advisory fee in dollars at my current portfolio balance. 2) The AUM breakpoint schedule and whether tiers are billed by slice or applied to the full balance. 3) My effective AUM rate after breakpoints. 4) Whether household, spouse, trust, taxable, IRA, Roth, HSA, inherited, and old employer accounts are aggregated for lower breakpoints. 5) Any fund expense ratios, platform fees, overlay fees, UMA/program fees, trading costs, tax-prep costs, legal costs, or implementation charges. 6) Whether financial planning is included in the AUM fee or billed separately. 7) What is included: investment management, retirement-income planning, tax coordination, estate-adjacent coordination, equity-comp help, and implementation support. 8) What is excluded and what becomes hourly, project-based, referred out, or out-of-scope. 9) Whether you can provide a flat annual, retainer, hourly, project-fee, or dollar-cap quote for the same planning scope. 10) Whether you act as a fiduciary at all times. My goal is to compare the total annual cost and scope in dollars before deciding. Thanks!
Balance-specific AUM checks: Compare AUM fees at $500k, AUM fees at $1M, and AUM fees at $2M; use the AUM breakpoints visual and AUM calculator how-to before you accept a percentage quote. For broader planning examples, use the financial advisor fees by portfolio size guide.
Breakpoints exist in state tax too
Breakpoints are the reason an AUM schedule is worth reading closely: cross one and the marginal rate changes. State estate tax works on the same principle, except the breakpoint is an exemption threshold and crossing it can be the difference between owing nothing and owing a percentage of everything above it. Several states set that threshold far below the federal exemption. Find where your balance falls with the personalised ranker, or read retirement tax relocation.
Methodology
- Dollar-first comparison. This page converts AUM percentages and breakpoint schedules into annual advisory dollars so readers can compare AUM, flat-fee, retainer, hourly, and project-fee proposals.
- By-slice examples. The primary example uses an illustrative tier schedule: 1.00% on the first $500,000, 0.80% on the next $500,000, and 0.60% above $1,000,000.
- Effective rate math. Effective AUM rate equals total annual advisory fee divided by portfolio balance.
- All-in examples. All-in examples add illustrative fund and platform/overlay costs to the advisory fee. Real proposals may include different fund expenses, platform fees, overlay fees, UMA/program fees, trading costs, tax-prep costs, legal costs, or implementation charges.
- Scope-first review. A fee is only meaningful when paired with written scope, deliverables, meeting cadence, implementation help, response-time expectations, specialist coordination, and exclusions.
- Data freshness. This page was last reviewed on July 3, 2026. Fee schedules, fund costs, platform costs, tax thresholds, and planning assumptions can change over time.
- Educational only. This is not tax, legal, or investment advice. For personal recommendations, talk to a qualified fiduciary advisor, CPA, or attorney.
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Before applying a breakpoint schedule: Use the $250k AUM fee guide to see the annual-dollar cost of common percentage quotes, minimum fees, and fixed-dollar planning alternatives at that exact balance.