Like many, I struggle with Imposter Syndrome. This month I did something I was so scared of, but now that all the paperwork is filed I just feel a sense of relief.
I raised my fees
Nothing too dramatic. Still perhaps below industry averages, but moving in a healthy direction. Those averages are skewed towards the upside anyway. I work with young Millennials and older Gen Z so I simply can’t charge the same amount as I would a client with a million plus dollars in investable assets.
Quick Aside About Said Fees
A little housekeeping before we get too deep in the imposter syndrome
The fee now includes an annual retainer, which allows me to be compensated for my time even if the client does not have a ton of money to be put into an investment account. There are two tiers of retainer fees based on “complexity”. I use air quotes because it simply boils down to “Do I need to consider a business’s finances?” Whether you are getting ready to launch or are three years into the business. If you are going to be bringing income statements/balance sheets/ etc. to meetings the fee is $1200 a year. Just personal planning is $600 a year. Both annual retainers are billed monthly to make payments a little more manageable.
Now back to your regularly scheduled programming
“We Suffer More in Imagination Than in Reality”
I realized pretty quickly I was undercharging. I billed only on assets under management (“AUM”) for clients who, in some cases, where just starting their retirement savings journey. In some cases I was charging less than one hundred a year, all while helping them budget, point them to quality high-yield savings accounts, offer advice on what we call “held-away” assets (Assets not directly managed by me). I was certainly providing value, my clients acknowledged it, and a small part of me knew it too.
So why did I sell myself short?
In part most of my current clients come from my natural network. People I’ve known for years, that had indicated interest in investing with me before I even launched. I didn’t want to nickel and dime them.
Part of however was I didn’t allow myself to be proud of the service I was providing. I hid behind a low fee, because I felt I didn’t want to try to justify my value. I felt like I couldn’t justify my value. Despite there clearly being value.
Laughing So I Don’t Cry
It would be funny if it wasn’t so sad, but I repeated the same mistake I made in college. I majored in Mathematics and so to my not math peers I came across as quite proficient in the area. Truthfully (and maybe this is more of me selling myself short) I was far from the strongest mathematician in my 400 level classes. I could, however, do their calculus homework in my sleep.
It started the same way, I worked with friends at first and then got referred further and further out of my natural network. It took some time, but I had to get comfortable with this radical idea… I had the skillset to provide meaningful value to people.
It’s funnier (but still not funny) that I got into financial advice because a lot of these same friends came to me with questions about their 401(k)s at there shiny, new, post-graduation jobs. When I started charging for advice, I undercharged again!
I was out there telling people how to save, pay themselves first, and I wasn’t making sure I was getting paid enough.
It’s probably because this time I was a career-changer. I felt like I was starting from scratch (which I was in a sense). I didn’t trust in myself after all I had been through. The number of financial advice clients grew much slower than the tutoring clients. Because of that it probably took longer than before to go through the whole process of getting frustrated with the amount of work I was doing and the lack of compensation. To get to the point of finally saying “I am worth more than this damnit!”
So Finally I Did!
I upped my fees a little. Honestly, it allows me to work with more people that I actually want to help. As mentioned I want to work with young millennials and elder Gen Z. Most of them do not have six-figure investment accounts but can pay a subscription fee for a service that will help them get there.
