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RETAIL REPORT: Schwab Introduces Subscription-Based Financial Planning Option

Traders Magazine Online News, April 12, 2019

John D'Antona Jr.

To simplify its approach to comprehensive professional guidance and financial planning for the firm’s digital advisory services, Charles Schwab is moving to a new subscription pricing model for Schwab Intelligent Advisory™ and renaming the service Schwab Intelligent Portfolios Premium™. There are no pricing changes to Schwab Intelligent Portfolios®, the firm’s automated investing service, which charges no advisory fee.

Schwab Intelligent Portfolios builds, monitors, and automatically rebalances a diversified portfolio of low-cost exchange-traded funds (ETFs) based on a client’s goals and provides 24/7 help from Schwab service professionals. This service is designed as a fully digital end-to-end experience, but clients also have access to professionals who can help with a range of topics including client goals, risk tolerance, and portfolio allocation.

Schwab Intelligent Portfolios Premium builds on Schwab Intelligent Portfolios to offer:

  • Unlimited 1:1 guidance from a CERTIFIED FINANCIAL PLANNER™ professional who can provide personalized financial advice based on current goals and provide ongoing advice as goals and circumstances change
  • A comprehensive financial plan that provides a customized roadmap for reaching financial goals
  • Ability to access the financial plan 24/7 via a comprehensive digital planning experience, including the ability to modify assumptions in real time to see how changing needs and circumstances could impact a client’s overall financial picture and help them stay on track

Introducing Subscription-Based Financial Planning

The 0.28% advisory fee clients previously paid for Schwab Intelligent Advisory, now called Schwab Intelligent Portfolios Premium, has been replaced with an initial one-time $300 fee for planning, and a $30 monthly subscription ($90 billed quarterly) that does not change at higher asset levels.

“Cost and complexity are two of the biggest roadblocks to accessing financial planning, and our goal is to break down those barriers,” said Cynthia Loh, Charles Schwab vice president of digital advice and innovation. “These changes are a result of client feedback and our commitment to meet consumer expectations for simplicity, transparency and value.”

“Subscription-based pricing is second nature to many of us who pay this way for other forms of ongoing access and guidance – from streaming media services to fitness and personal training memberships. We think people should have the opportunity to pay for financial planning the same way,” added Loh. “This new pricing approach is part of our focus on making the investing and planning experience easier, more modern, and more approachable. We’re looking forward to helping people get the financial help they need, whether they’re investing for the long term or have more immediate life events that require a plan.”


How Schwab Intelligent Portfolios and Schwab Intelligent Portfolios Premium Compare

      Schwab Intelligent Portfolios    

Schwab Intelligent Portfolios 

Investment minimum     $5,000     $25,000
Fees     No advisory fee charged    

One-time $300 initial
planning fee and $30/month
for unlimited guidance

Diversified portfolio of low-cost
exchange-traded funds (ETFs)

    Yes     Yes

Daily monitoring and automatic
rebalancing as needed

    Yes     Yes
Tax-loss harvesting*     Yes     Yes
24/7 support from professionals     Yes     Yes

Unlimited 1:1 guidance from a

    No     Yes
Comprehensive financial plan     No     Yes
Interactive online planning tools     No     Yes

Just as if they had invested on their own, clients in Schwab Intelligent Portfolios and Schwab Intelligent Portfolios Premium pay the operating expenses on the ETFs in the portfolio, which includes a combination of Schwab ETFs™ and funds from third party providers. Based on a client’s risk profile, a portion of the portfolio is placed in an FDIC-insured deposit at Schwab Bank. Some cash alternatives outside of the program pay a higher yield. See additional cost information below.

Clients do not pay commissions in Schwab Intelligent Portfolios and Schwab Intelligent Portfolios Premium. More information about Schwab’s digital advisory services is available here.

For more information on related topics, visit the following channels:

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