Take the Headache out of Splitting Advisor Fees
August 30, 2023 | Financial Industry, RIA Resources
This post was originally published on Envestnet’s blog.
Billing software has helped automate the process, but there are still a number of operational issues that are not supported and require significant manual effort from the operations team. Splitting fees among advisors is one of these issues.
While the math to split fees is simple, the process to implement and track it is not. As most billing systems do not offer this feature, firms are forced to use spreadsheets to track and manage their split fees. The complexity increases when paying third parties, such as CPAs. Solicitor’s agreements are required in order to share fees with non-licensed professionals. This must be done separately from billing, creating more work.
Fee splitting is a pain, but often not painful enough to switch billing platforms, which can sometimes feel like a monumental task. What RIAs have been waiting for is an add-on billing tool that can handle the workflow and tracking required for splitting fees in a simple and intuitive manner.
Today, we’re excited to announce that the wait is over. BillFinTM launched Payouts, a platform-agnostic fee-splitting solution that brings one of our key features to any RIA and works seamlessly with their existing billing software.
A fee-splitting solution for your existing billing software
Payouts is a new standalone offering that allows an RIA to set up all of their fee-splitting structures and rules and generate reports to assist in the payout process. It is an affordable add-on to your existing billing solution and supports a wide range of complex fee-splitting configurations.
How Payouts saves you time
To begin using Payouts, you first supply the system with your rules on how the fees are split. As you receive client fees, these are inputted into the app using CSV files, and Payouts generates reports that can be used for advisor payments. Reports are generated in seconds, saving back-office personnel time that can be spent working on other essential tasks. And since Payouts only handles the calculations, you can use whatever billing and payroll system you wish.
When you first enter the Payouts interface, you’ll be greeted with an RIA-wide view of clients, advisors, and fees on the same page.
Start with entering in your client account details. Payouts has multiple connectors to help you sync your data seamlessly or you can upload your client data via our agnostic CSV file portal.
Next, you’ll input your externally calculated fees. You can work with the data in several ways. One option is the drop-down menus at the top. You can filter by year or cycle or download an Excel spreadsheet for more advanced analysis. For easy reference, we’ve also included statistics on both your current and prior cycle’s fees externally calculated. These external fees are uploaded in via CSV format by clicking the “Upload External Fees” button.
To generate a payout report, you select who you’d like to pay, and in a single button click, reports are produced. Once Payouts is set up, the app remembers the rules you set, making subsequent payouts even faster.
Compensate your advisors more efficiently
Dealing with complicated fee splits, multiple advisor payments, and third-party can be a headache. This, in turn, can shift your focus away from your clients. With Payouts, we aim to remove the bottlenecks and streamline your operations. Payouts seamlessly operates with your current billing system. All you need to do is set it up, input your fees and compensation rules, and it does the rest. Now’s the time to say goodbye to manual calculations, administrative burdens, and the one-size-fits-all approach of other platforms.
Keep in mind, should you need a new billing solution, Payouts is also an add-on to our BillFin billing solution and is easily activated. BillFin will calculate your fees, create invoices, generate the payment files for your custodians, and calculate your payout compensation all with one click.
To learn more about Envestnet’s broad ecosystem of services, products, tools, and technologies, visit https://www.envestnet.com/our-ecosystem.
Redi2 Technologies, Inc. (Redi2), a leading provider of revenue management and hosted fee-billing solutions in the global financial services industry and parent company of BillFin™, was acquired by Envestnet in July 2022.
The information, analysis and opinions expressed herein are for informational purposes only and do not necessarily reflect the views of Envestnet. These views reflect the judgment of the author as of the date of writing and are subject to change at any time without notice. Nothing contained in this piece is intended to constitute legal, tax, accounting, securities, or investment advice, nor an opinion regarding the appropriateness of any investment, nor a solicitation of any type.
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