September 17, 2010
We have an inactive fee here where if somebody has not made a trade over the past year, we charge a fee for maintaining the account. Every firm does it, and most started long before we got on board. Initially I saw this as another way to tag the clients with a fee and was, accordingly, dismissive and reluctant to participate. But I have come to see that it does make sense to use this as a tool to clean up little accounts that have been forgotten. A fee, no matter how small, tends to spur action like nothing else.