Private banking fees can add up—so you need to understand what you’re paying and how to get the best value!

Here’s what you need to know about private banking fees.

Common Private Banking Fee Structures

1. Assets Under Management (AUM) Fee: Most common—you pay a percentage of your assets each year (0.5%-1.5%). For example, if you have $10M AUM and a 1% fee, you pay $100k/year.
2. Flat Fee: Fixed annual or monthly fee, regardless of AUM. Good for clients with high assets.
3. Commissions: Fees for buying/selling investments (avoid this—look for fee-only fiduciaries!)
4. Hourly Fees: Pay by the hour for specific services (e.g., financial planning)
5. Bundled Pricing: All services included in one fee—simple, but make sure you’re not paying for services you don’t use.

What Do Private Banking Fees Cover?

• Relationship manager
• Investment management
• Wealth planning (estate, tax, retirement)
• Banking services (checking, savings, loans)
• Trust services
• Concierge services (varies)

How to Get the Best Value on Private Banking Fees

1. Compare Fees from Multiple Banks: Don’t just go with the first bank you meet—shop around!
2. Negotiate: Private banking fees are often negotiable—especially if you have high assets.
3. Ask for Bundled Pricing: Bundled fees can be simpler and cheaper than paying for each service separately.
4. Avoid Commissions: Choose a fee-only fiduciary—they don’t earn commissions, so they act in your best interest.
5. Make Sure You’re Getting Value: The cheapest bank isn’t always the best—make sure you’re getting the services and expertise you need.

Fee Structure	Best For
AUM Fee	Most clients, especially with $1M-$10M AUM
Flat Fee	High AUM ($10M+), predictable costs
Hourly	One-time planning
Bundled	Full-service, want simplicity

Hidden Fees to Watch For

• Transaction fees (for buying/selling investments)
• Account fees
• Wire transfer fees
• Trust fees
• Estate settlement fees
• Custodian fees

Frequently Asked Questions

Are private banking fees tax-deductible?

Investment management fees were formerly deductible, but the 2017 Tax Cuts and Jobs Act suspended this—ask your tax advisor for current rules.

Can I negotiate private banking fees?

Yes—especially if you have high assets!

How much should I expect to pay in private banking fees?

Typically 0.5%-1.5% of AUM per year.

Final Thoughts

Private banking fees are an important consideration—understand how fees work, compare options, negotiate, and make sure you’re getting good value!