Description of Services and Fees
Rademacher Financial, Inc. is a registered investment adviser based in Lawrence, Kansas. Our firm is
organized as a sub-chapter S-Corporation under the laws of the State of Kansas. We have been
providing investment advisory services since 1999. Phillip Rademacher and Rachel Rademacher are
our principal owners. Currently, we offer the following investment advisory services, which are
personalized to each individual client:
• Portfolio Management Services
• Financial Planning and Consulting Services
• Individual Retirement Plan Consulting Services
The following paragraphs describe our services and fees. Please refer to the description of each
investment advisory service listed below for information on how we tailor our advisory services to your
individual needs. Also, you may see the term Associated Person throughout this Brochure. As used in
this Brochure, our Associated Persons are our firm's officers, employees, and all individuals providing
investment advice on behalf of our firm.
Portfolio Management Services
We offer discretionary portfolio management services whereby our investment advice is tailored to
meet our clients’ needs and investment objectives. If you retain our firm for portfolio management
services, we will meet with you to determine your investment objectives, risk tolerance, and other
relevant information at the beginning of our advisory relationship. We will use the information we
gather to develop a strategy that enables our firm to give you continuous and focused investment
advice and/or to make investments on your behalf. As part of our portfolio management services, we
will customize an investment portfolio for you according to your risk tolerance and investing objectives.
We may also invest your assets according to one or more of our internal model portfolios that range
from conservative (low risk) to growth (high risk) developed by our firm. Once we construct an
investment portfolio for you, or select a model portfolio, we will monitor your portfolio’s performance on
an ongoing basis, and will rebalance the portfolio as required by changes in market conditions and in
your financial circumstances. You will be provided with ongoing investment advice and monitoring of
your securities holdings.
If you participate in our discretionary portfolio management services, we require you to grant our firm
discretionary authority to manage your account. Discretionary authorization will allow us to determine
the specific securities, and the amount of securities, to be purchased or sold for your account without
your approval prior to each transaction. Discretionary authority is typically granted by the investment
advisory agreement you sign with our firm and the appropriate trading authorization forms. You may
limit our discretionary authority (for example, limiting the types of securities that can be purchased for
your account) by providing our firm with your restrictions and guidelines in writing.
Financial Planning and Consulting Services
Rademacher Financial, Inc. offers financial planning and consulting services which typically involve
providing a variety of advisory services to clients regarding the management of their financial
resources based upon an analysis of their individual needs. These services can range from broad-
based financial planning to consultative or single subject planning. If you retain our firm for financial
planning services, we will meet with you to gather information about your financial circumstances and
objectives. We may also use financial planning software to determine your current financial position
and to define and quantify your long-term goals and objectives. Once we specify those long-term
objectives (both financial and non-financial), we will develop shorter-term, targeted objectives. Once
we review and analyze the information you provide to our firm and the data derived from our financial
planning software, we will deliver written plan recommendations to you, designed to help you achieve
your stated financial goals and objectives.
Financial plans are based on your financial situation at the time we present the plan to you, and on the
financial information you provide to our firm. You must promptly notify our firm if your financial
situation, goals, objectives, or needs change.
You are under no obligation to act on our financial planning recommendations. Should you choose to
act on any of our recommendations, you are not obligated to implement the financial plan through any
of our other investment advisory services. Moreover, you may act on our recommendations by placing
securities transactions with any brokerage firm you choose.
As part of the financial planning process, Rademacher Financial provides business succession advice,
determination of long term care or disability insurance needs and evaluation of employee benefits.
Rademacher Financial may also offer limited administrative services, which include cash flow
management, document and record management, and coordination of external advisers. These
services are offered in conjunction with our financial planning and consulting services.
Individual Retirement Plan Consulting Services
We offer retirement plan services on a discretionary and non-discretionary basis with a focus on
education and communications to the participants of retirement plans such as 401(k) Plans, which are
custodied outside our normal custodial relationships. Typically, services involve advice and/or
recommendations of investments available in the participant's plan, such as fund selection, and
periodic reviews of investment options.
Wrap Fee Programs
We do not participate in any wrap fee program.
Types of Investments
We primarily offer advice on investment company securities (mutual funds), and exchange traded
funds. We will also provide advice on: equity securities, warrants, corporate debt securities, certificates
of deposit, municipal securities, U.S. Government securities, and interest in partnerships investing in
real estate. Additionally, we may recommend other types of investments since each client has different
needs and different tolerances for risk. We may also advise you on any type of investment held in your
portfolio at the inception of our advisory relationship, or on specific types of investments at your
request.
Since our investment strategies and advice are based on each client’s specific financial situation, the
investment advice we provide to you
may be different or conflicting with the advice we give to other
clients regarding the same security or investment.
You may request that we refrain from investing in particular securities or certain types of securities.
You must provide these restrictions to our firm in writing.
IRA Rollover Considerations
As part of our investment advisory services to you, we may recommend that you withdraw the assets
from your employer's retirement plan and roll the assets over to an individual retirement account
("IRA") that we will manage on your behalf. If you elect to roll the assets to an IRA that is subject to our
management, we will charge you an asset based fee as set forth in the agreement you executed with
our firm. This practice presents a conflict of interest because persons providing investment advice on
our behalf have an incentive to recommend a rollover to you for the purpose of generating fee based
compensation rather than solely based on your needs. You are under no obligation, contractually or
otherwise, to complete the rollover. Moreover, if you do complete the rollover, you are under no
obligation to have the assets in an IRA managed by our firm.
Many employers permit former employees to keep their retirement assets in their company plan. Also,
current employees can sometimes move assets out of their company plan before they retire or change
jobs. In determining whether to complete the rollover to an IRA, and to the extent the following options
are available, you should consider the costs and benefits of:
1. Leaving the funds in your employer's (former employer's) plan.
2. Moving the funds to a new employer’s retirement plan.
3. Cashing out and taking a taxable distribution from the plan.
4. Rolling the funds into an IRA rollover account.
Each of these options has advantages and disadvantages and before making a change we encourage
you to speak with your CPA and/or tax attorney.
If you are considering rolling over your retirement funds to an IRA for us to manage here are a few
points to consider before you do so:
1. Determine whether the investment options in your employer's retirement plan address your
needs or whether you might want to consider other types of investments.
a. Employer retirement plans generally have a more limited investment menu than IRAs.
b. Employer retirement plans may have unique investment options not available to the
public such as employer securities, or previously closed funds.
2. Your current plan may have lower fees than our fees.
a. If you are interested in investing only in mutual funds, you should understand the cost
structure of the share classes available in your employer's retirement plan and how the
costs of those share classes compare with those available in an IRA.
b. You should understand the various products and services you might take advantage of
at an IRA provider and the potential costs of those products and services.
3. Our strategy may have higher risk than the option(s) provided to you in your plan.
4. Your current plan may also offer financial advice.
5. If you keep your assets titled in a 401k or retirement account, you could potentially delay your
required minimum distribution beyond age 73.
6. Your 401k may offer more liability protection than a rollover IRA; each state may vary.
a. Generally, federal law protects assets in qualified plans from creditors. Since 2005, IRA
assets have been generally protected from creditors in bankruptcies. However, there
can be some exceptions to the general rules so you should consult with an attorney if
you are concerned about protecting your retirement plan assets from creditors.
7. You may be able to take out a loan on your 401k, but not from an IRA.
8. IRA assets can be accessed any time; however, distributions are subject to ordinary income tax
and may also be subject to a 10% early distribution penalty unless they qualify for an exception
such as disability, higher education expenses or the purchase of a home.
9. If you own company stock in your plan, you may be able to liquidate those shares at a lower
capital gains tax rate.
10. Your plan may allow you to hire us as the manager and keep the assets titled in the plan
name.
It is important that you understand the differences between these types of accounts and to decide
whether a rollover is best for you. Prior to proceeding, if you have questions contact your investment
adviser representative, or call our main number as listed on the cover page of this brochure.
IRA Rollover Recommendations
Effective December 20, 2021 (or such later date as the US Department of Labor (“DOL”) Field
Assistance Bulletin 2018-02 ceases to be in effect), for purposes of complying with the DOL’s
Prohibited Transaction Exemption 2020-02 (“PTE 2020-02”) where applicable, we are providing the
following acknowledgment to you. When we provide investment advice to you regarding your
retirement plan account or individual retirement account, we are fiduciaries within the meaning of Title I
of the Employee Retirement Income Security Act and/or the Internal Revenue Code, as applicable,
which are laws governing retirement accounts. The way we make money creates some conflicts with
your interests, so we operate under a special rule that requires us to act in your best interest and not
put our interest ahead of yours. Under this special rule’s provisions, we must:
• Meet a professional standard of care when making investment recommendations (give prudent
advice);
• Never put our financial interests ahead of yours when making recommendations (give loyal
advice);
• Avoid misleading statements about conflicts of interest, fees, and investments;
• Follow policies and procedures designed to ensure that we give advice that is in your best
interest;
• Charge no more than is reasonable for our services; and
• Give you basic information about conflicts of interest.
We benefit financially from the rollover of your assets from a retirement account to an account that we
manage or provide investment advice, because the assets increase our assets under management
and, in turn, our advisory fees. As a fiduciary, we only recommend a rollover when we believe it is in
your best interest.
Assets Under Management
As of December 31, 2022, we provide continuous management services for $112,797,322 in client
assets managed on a discretionary basis and $6,321,730 in client assets on a non-discretionary
basis.