An AUM fee rises as the client’s portfolio balance grows. Our fee does not.

Under a traditional one percent AUM fee, the dollar amount paid to the advisor rises as the portfolio grows. Valorem charges a fixed $15,000 annual fee, so the cost of advice does not increase simply because the client’s assets do.

Valorem, $15,000 flat Traditional advisor, 1% of assets

Assumptions

$3,000,000 starting portfolio 8% annual return Fees billed annually

Methodology and notes

Fees are billed at the start of each year on the opening balance. A flat fee is not lower for every account: a 1% fee equals $15,000 at $1,500,000, so this comparison favors the flat fee only above that level. Illustration only; it is not a projection of any client’s results.

See it at your own portfolio size

Type a value or move the slider. Reset to $3,000,000

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A percentage based advisory fee can become significantly more expensive over time.

In this illustration, a one percent AUM fee results in $1,219,175 of advisory fees over twenty years. Valorem’s fixed annual fee totals $300,000 over the same period, a difference of $919,175.

Traditional advisor, 1% of assets

Valorem, $15,000 flat

Difference over twenty years

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Advisory fees paid on a $3,000,000 portfolio, cumulative, years 1 to 20

Assumes a $3,000,000 starting portfolio, an 8% annual return, and fees billed at the start of each year. A flat fee is not lower for every account. A 1% fee equals $15,000 at $1,500,000, so this comparison favors the flat fee only above that level. Illustration only; not a projection of any client’s results.

Money paid in fees stops compounding for you.

The difference in advisory fees is only part of the cost. Money paid to an advisor is no longer invested, so it also gives up the future growth it could have earned. In this illustration, the difference in ending portfolio value grows to $1,804,840 after twenty years.

Ending value, 1% of assets

Ending value, Valorem

Difference in ending value

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Vertical scale starts at the amount invested. Fees are billed at the start of each year on the opening balance; both portfolios earn the same return. Illustration only; not a projection of any client’s results.

Portfolio value on a $3,000,000 account, both earning the same 8%

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Starting portfolio

Annual return

Time period

Reset to the $3,000,000 example

Sound financial advice can reduce an AUM advisor’s compensation.

Recommendations such as paying down debt, buying property, or investing outside a managed account may be right for the client while reducing what the advisor earns. Valorem’s flat annual fee removes that conflict because our compensation does not change based on which recommendation is made.

A decision you might make

Assets that leave the managed account

Change in annual advisory revenue at a 1% fee

At Valorem

Pay off a $600,000 mortgage

$600,000

($6,000)

Buy a second home outright

$1,200,000

($12,000)

Tax on a Roth conversion¹

$1,200,000

($12,000)

Invest in a private investment held away

$750,000

($7,500)

Start a $1,000,000 business

$1,000,000

($10,000)

¹ A $4,000,000 conversion completed over several years. Converting does not itself remove money from the account, but paying the tax from a taxable account does, so once the conversions are complete about $1,200,000 has left the billable balance. The figure assumes a 30% blended federal and state rate across the conversion years. Actual tax owed depends on individual circumstances and on the law at the time. All figures are illustrative.

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Major wealth management firms disclose conflicts created by their compensation structures.

How an advisor is paid can influence the recommendations they are economically incentivized to make, including which investments they recommend. Valorem does not receive additional compensation based on any of these decisions, and our fee is the same whether a client holds cash, borrows against a portfolio, sells assets, or invests through a product held outside Valorem.

A private fund may only be offered if the firm is paid to sell it.

Best Interest Disclosure Statement · June 2026

"We only offer and recommend Alternative Investment Funds where we receive distribution fees… Certain Alternative Investment Funds that would otherwise meet our criteria for inclusion on our product platform will not be available for purchase in your Account if the distribution fees are not paid to us."

Advisor compensation can vary by the product recommended.

Form ADV Wrap Fee Program Brochure · Page 107

"The receipt of cash and non-cash compensation from sources other than clients, and the differences in the way we compensate Financial Advisors for the products we offer, create an incentive for Financial Advisors to recommend certain products and account types over others."

A firm can earn more when clients receive less interest on cash.

Bank Deposit Program Disclosure Statement · June 2025

"The Morgan Stanley Sweep Banks… are under no legal or regulatory requirement to maximize those interest rates… The lower the amount of interest paid to customers, the greater is the 'spread' earned by the Morgan Stanley Sweep Banks."

An AUM fee can affect the advice given.

Securities-Based Lending Disclosure

"Wells Fargo Advisors and its Financial Advisors have a financial incentive to recommend the use of securities-based lending products rather than the sale of securities to meet client liquidity needs."

Quoted verbatim from each firm’s published client disclosures, emphasis added by Valorem Wealth. Logos identify the source document only and imply no affiliation with or endorsement of Valorem Wealth.

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An AUM fee rises as the client’s portfolio balance grows. Our fee does not.

A percentage based advisory fee can become significantly more expensive over time.

Money paid in fees stops compounding for you.

Sound financial advice can reduce an AUM advisor’s compensation.

Major wealth management firms disclose conflicts created by their compensation structures.

Book a call with Valorem.