Read This Article if Your Financial Planning Hawaii Accounts are Held at NFS
By John H. Robinson, Financial Planner (January 25, 2025)
In 2024, I announced plans to migrate all Financial Planning Hawaii clients whose accounts are custodied with/on Fidelity’s National Financial Service (NFS) platform to Fidelity’s Institutional Wealth Services (IWS) platform. This initiative is now underway. FPH’s new team member and resident Admin Whiz, Emily Forraht, is beginning to prepare the requisite paperwork for client delivery. I will be reaching out to all NFS clients individually with the goal of having all clients migrated by June 30th.
What Are the Benefits of Changing from NFS to IWS?
A primary motivation for making this change is to escape NFS’ ticket charges (commissions), annual account fees, and inactivity fees. Although these fees are sometimes dismissed merely as nominal nuisance expenses, collectively, they add up to thousands of dollars per year. In my recent blog post, If Costco and Hermes had a Baby, I shared how Jeff Bezos incorporated profound advice he received from Costco CEO Jim Sinegal. In recounting the meeting, Bezos learned, “…there are two types of companies in this world – companies that work hard to charge their customers more, and companies that work hard to charge their customers less. Amazon wants to be a company that works hard to charge its customers less.” Financial Planning Hawaii is a company that works hard to charge its customers less too.
If you are wondering why I did not launch this initiative sooner, actually, I did! It took three years to migrate roughly 80% of our clients from NFS to TD Ameritrade before TD was subsequently acquired by Charles Schwab. Since then, I have gained the ability to switch from NFS to IWS, which both avoids the $75 per account transfer fee that NFS charged clients to transfer to TD/Schwab and is less disruptive to clients because it is still under the Fidelity umbrella. The task is also extremely labor/time intensive, but now that Emily is on board, we have the capability to get the job finished.
A second client benefit is that he Fidelity IWS website is similar in design to the eMoney experience (Fidelity owns eMoney). Many clients have complained over the years about how clunky and dated NFS’ Wealthscape experience is. The Fidelity IWS site is a modern user-friendly experience.
Will There Be Any Additional One-time or Ongoing Cost to Switch from NFS to IWS?
For all FPH clients who have accounts with NFS that are billed under our asset-based fee agreement, there will be no change in the advisory fees you are paying for ongoing comprehensive financial planning and portfolio management guidance. As mentioned above, you will not only say goodbye to nuisance fees, but you will also avoid the customary $75 account transfer fee that the delivering firm charges. This fee is avoided thanks to the generous support and assistance from our friends at JW Cole who have offered to manually journal the positions from NFS to IWS accounts instead of processing the transfer via the usual Automated Clearing and Transfers (ACAT) process. I am grateful to JWC for doing this because they definitely are not required to and it is more work for them. I estimate that it will collectively save FPH clients $10,000-$15,000!
For FPH clients who still maintain commission-based brokerage accounts at NFS, migrating to Fidelity IWS will require switching to our financial planning platform and signing our investment advisory fee agreement. In most cases, clients who are migrating from brokerage accounts to advisory accounts may end up paying more. As I explained in my September 2024 post, “Why I am Planning to Drop My Brokerage License,” maintaining my brokerage license is antithetical to my desire to serve as a fiduciary at all times. My business moved away from commission-based product sales to selling ongoing objective financial planning and investment management advice long ago. I have fewer than ten brokerage clients left – all of whom are longtime friends as much as they are clients. If you are among them, I will contact you individually to discuss the change. It is not mandatory. If you do not wish to change, I can refer you to one of my friends at JW Cole who can help you maintain your brokerage account.
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John H. Robinson is the owner/founder of Financial Planning Hawaii and Fee-Only Planning Hawaii. He is also a co-founder of fintech software maker Nest Egg Guru and the new personal finance website NestEggPF.com.
