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Updated July 3, 2026. Quick answer: A flat fee beats AUM on price when the annual flat fee is lower than the advisor’s AUM fee in dollars for the same written scope, fiduciary status, and implementation help. Example: a $6,000 flat annual fee equals 0.75% AUM at an $800,000 portfolio, 0.60% AUM at $1,000,000, and 0.30% AUM at $2,000,000. Use this flat fee vs AUM calculator to find your break-even balance, then run the same quote through the financial advisor fee calculator and the financial advisor fees comparison chart before comparing 10-year cost.
The math only answers the price question. Before choosing flat fee vs AUM, compare scope too: retirement income, tax coordination, portfolio implementation, response time, meeting cadence, who does the work, whether the advisor will act as a fiduciary for the full relationship, and whether a flat annual, retainer, hourly, or AUM model includes the same work.
Fast tools: Financial advisor fee calculator · AUM Fee Calculator · 10-Year Fee Comparison · Advisor fee comparison chart · Which Fee Model Fits Me? · Flat Fee Financial Advisor
Flat fee vs AUM break-even calculator
Enter a portfolio balance and flat annual fee of $0 or more, an AUM fee greater than 0% and no more than 100%, and annual growth from -100% to 100%. Results are a simplified educational comparison, not a return forecast.
10-year simple-cost illustration
| Model | 10-year total | Difference |
|---|---|---|
| AUM fee | — | — |
| Flat fee | — |
This simplified model assumes the flat fee stays constant and the AUM fee applies to the full balance each year. Real AUM schedules may be tiered, and real flat fees may change by scope or complexity.
Compare your break-even result before an intro call
Use the calculator result to ask whether the AUM quote and flat annual quote include the same written scope, fiduciary duty, tax coordination, portfolio implementation, meeting cadence, and response-time standard.
Next compare: Financial Advisor Fee Calculator – 10-Year Fee Comparison – AUM Fees by Balance – Flat Fee Advisor Near Me.
Flat fee vs AUM examples
| Flat annual fee | AUM rate | Break-even balance | What it means |
|---|---|---|---|
| $5,000/year | 1.00% | $500,000 | Above $500k, flat is cheaper on price if scope is equal. |
| $6,000/year | 0.75% | $800,000 | Above $800k, flat is cheaper on price if scope is equal. |
| $8,000/year | 0.80% | $1,000,000 | At $1M, both cost about $8k before extra costs. |
| $10,000/year | 0.50% | $2,000,000 | At lower balances, AUM may be cheaper on price; scope still matters. |
How to use the break-even result
- If your balance is above the break-even: the flat fee is cheaper on price, assuming the same scope.
- If your balance is below the break-even: AUM may be cheaper on price, but only if the service scope still fits.
- If the numbers are close: compare deliverables, service calendar, response time, tax coordination, and implementation help.
- If the AUM schedule is tiered: use the AUM Fee Calculator instead of assuming one rate applies to the full balance.
What AUM can include that flat fee may not
AUM pricing can make sense when the advisor is actually managing the portfolio, rebalancing, coordinating tax-aware trades, handling implementation, and staying accountable for ongoing investment decisions. A flat fee can make sense when you mainly want planning, retirement-income strategy, a written scope, or a second opinion without paying a percentage of assets.
| Question | Why it matters |
|---|---|
| Is portfolio management included? | AUM may include ongoing investment implementation; some flat-fee quotes are planning-only. |
| Are taxes coordinated? | Roth conversions, taxable-account sales, capital gains, and retirement withdrawals can change the value of the advice. |
| Are extra costs separate? | Fund expenses, platform fees, overlay fees, trading costs, and tax-prep fees can change the all-in answer. |
| Who does the work? | Lead planner, associate planner, investment team, CPA, or outside specialist involvement changes scope and quality. |
Copy/paste: ask for an apples-to-apples quote
Subject: Flat fee vs AUM quote comparison
Hi — before our intro call, could you help me compare your quote apples-to-apples?
1) What is my total first-year cost in dollars under your AUM quote?
2) What would the flat annual fee be for the same planning scope?
3) Are fund expenses, platform fees, overlay fees, trading costs, tax prep, or implementation charges separate?
4) What is included in writing: retirement income, Roth conversions, Medicare/IRMAA, taxable-account sales, investment policy, and implementation help?
5) Who does the work — lead planner, associate planner, investment team, CPA, attorney, or outside specialist?
If the AUM fee is tiered, please confirm whether tiers are billed by slice or applied to the whole balance.
If the flat fee excludes portfolio management, please clarify exactly what investment implementation support is included.
Thanks!What to do next
Next step: Use the break-even result, the quote checklist above, and the same written scope to compare AUM, flat annual, retainer, hourly, and project pricing before booking a second call.
Helpful next reads: Flat-Fee Financial Advisor · AUM Fees by Balance · AUM Fees at $1M · Financial Advisor Hourly Rate · Financial Advisors by City
Compare the break-even point against advisor rates
Use the financial advisor rate chart after the break-even calculator to compare AUM, flat annual, retainer, hourly, project, and robo/platform quotes with the same written scope.
Flat-fee model guide
Before relying on the break-even number alone, use the flat fee financial advisor guide to compare scope, implementation, fiduciary status, and hidden costs.
You know your break-even balance. Ask both kinds of adviser to price against it.
Above that balance a percentage costs more than a flat fee for the same work, and the gap only widens. Take the number into both conversations — the advisers below pay for the introduction, so the quote is yours to demand. It is free to you, and it is not the only way to find an adviser.
Before you start, what actually happens. The form is run by Kapitalwise, our advisor-matching partner. It asks about nine questions — age, investable assets, location — then your name, email and phone number, and verifies the phone by text.
Kapitalwise sends your details to advisers who pay for the introduction, so expect calls and texts. Clear Money Guide is paid when you submit the form, whether or not you ever hire anyone. Nothing loads and nothing reaches Kapitalwise until you press the button.
Compare fees, scope, conflicts, credentials and fiduciary duty before you hire anyone.
The Kapitalwise form opens here — you stay on this page.
Methodology
- Break-even formula. The calculator uses: flat annual fee ÷ AUM percentage = break-even balance.
- 10-year illustration. The model applies the AUM percentage to the projected balance each year and compares it with a constant flat annual fee.
- Scope-first review. Price only matters after confirming deliverables, service calendar, implementation help, response time, and what is excluded.
- Planning estimates. Results exclude fund expenses, platform fees, overlay fees, trading costs, tax-prep fees, taxes, and implementation charges unless stated.
- Data freshness. This page was last reviewed on July 3, 2026. Advisor fees and service models can change.
- Educational only. This is not tax, legal, or investment advice. Confirm your advisor’s written agreement before acting.
Editorial standards: Editorial Policy · Corrections · Disclaimer
If the money is in the TSP, the rulebook is its own: the 10% penalty turns on the year you separated, not your age when you withdraw, and that exception does not survive a rollover to an IRA. What keeping it or moving it costs puts the difference in dollars.