When Denise Downey, a certified financial planner and owner of Financial Trex LLC, first began her business in 2016, she couldn’t find any firms in Spokane that offered services for fees rather than commissions. 

In the past couple of years, the industry has shifted, and Downey has witnessed a growth in fee-based financial planners over commissioned-based financial planners. 

“I think more people are becoming aware of the fact that a lot of financial planners are commission based, and they don’t like that,” Downey says. “There’s been a lot of podcasts and blogs that have come over the years that have encouraged people to move away from that service.” 

The trend is not just within the Spokane market but within the wider industry. According to a report from the Securities and Exchange Commission, the total number of advisory firms with a fee-only model rose to 2,663 in 2021, a 20% increase from 2,215 firms in 2019. 

“I think the financial planning (industry) in general gets a bit of a bad reputation because it’s sell-sy,” Downey says. “I have a strong opinion that when it comes to money, there shouldn’t be any conflicts of interest.” 

Before moving with her family to Spokane in 2015, Downey spent 13 years working for large financial firms in Chicago, offering commission-based financial planning. After she left her previous job, people began to approach her for advice, and she realized she could find success without charging a commission. 

“I had all these people coming out of the woodwork, all my friends and family saying, 'OK, now that you’re not with that company, can you help me with my 401K?'” Downey says. “They knew that conflict of interest was out, and I realized, people really do need help, but they’re afraid to ask for it ... because they’re afraid of getting sold something. I thought, maybe I can make a business of this.” 

Downey is an independent certified financial planner who offers two types of services: comprehensive financial planning services and hourly financial planning services. The comprehensive financial planning service comprises quarterly meetings, a personalized financial plan, access to the client’s financial metrics through an interactive planning platform, and an optional investment management service with annual fees of 0.45% to 0.75% of assets under management. 

That's different from what's considered commission sales within the industry, Downey says, because commissions are based on a specific product or service sold. For example, a commission may be earned by investing the client's money in a specific mutual fund, stock, annuity, and other products. The assets-under-management fee is purely based on the amount of money being invested, regardless of what it is invested in, she says. 

"The AUM fee is the same whether I invest the client's money in CDs, mutual funds, or stocks," Downey says. "This removes the 'conflict of interest' component that commission sales carry." 

The rate for a comprehensive financial planning service is about $800 per quarter, Downey says.

Most of Financial Trex’s clients trade on their investment accounts with Downey often sitting alongside, offering advice on what to trade or sell. For clients who prefer Downey to take the reins of their accounts, she will use online financial platforms offered by Charles Schwab Corp. or Betterment, a financial advisory company that provides digital investment, retirement, and cash management services. Depending on the amount Downey manages for a client, she will typically reduce their comprehensive financial planning fee if they also have a management fee, Downey says.

Hourly financial planning is for people looking for guidance on their finances or help with a project, Downey says. The service is for a one-time engagement that can focus on anything the client wants. The hourly rate is $300. 

Downey says the services that she offers don’t differ much from when she was doing commission-based work. 

“When I was working in the (commission) environment, the focus was more, 'how can I get you to invest money with my firm or this particular product or service?'” Downey says. “Whereas now my focus is, how can I help you meet your goals?”

Financial Trex has 65 clients, a workload that keeps Downey busy but not overburdened and allows her to spend more time with her family. While she makes less now than when she worked long hours doing commission-based work, she prefers the work-life balance she now has and offering a service that helps others without needing to be doing sales. 

 Financial Trex’s annual net revenue is about $150,000, Downey says. 

 “That’s perfect for my family's needs,” Downey says. “I do work less too. At my previous job, it was long hours, hard hours. Now I work less and make less, but it’s a much better quality of life.” 

Downey works from her home on Spokane's South Hill and isn't interested in scaling her business. Instead, she hopes to reach out to the local financial planning community and universities to offer an internship opportunity. 

Many of the clients that Downey assists are in the “sandwich generation,” consisting of middle-aged adults who often care for elderly parents and their children. 

 “I think it’s because that’s my demographic too,” Downey says. “They have a lot of balls in the air between raising little ones at home, taking care of aging parents, and then all their goals, whether it be buying a home, retirement, travel, job change, all that stuff in between.” 

Generally, when it comes down to saving money, it comes down to budgeting, Downey says. 

“Budgeting is a really tricky topic because it’s personal for everybody, it’s almost like dieting,” Downey says.  

Downey says budgeting is about analyzing one’s spending and making sure it aligns with their values. For example, for someone who identifies as a “foodie,” and eating out is a source of enjoyment, Downey typically won't advise that client to cut restaurant dining from their budget. But she'll suggest cooking at home for others who are simply eating out a lot and don’t necessarily consider it important. 

At times, Downey has referred clients to financial therapists, a growing niche that began to grow traction after the financial crisis of 2008, according to the Financial Therapy Association.  Financial therapists blend behavioral and emotional therapy concerning finances. 

“There’s a lot of emotional parts to spending,” Downey says. “I’m not a trained therapist, and sometimes I have to play that role to a certain extent. I’m glad that subset of the financial planning industry exists because I think there’s a need for that.”