A. Transition Financial Advisors Group, Inc. (the “Registrant”) is a corporation formed on
January 3, 2001 in the State of Arizona. The Registrant initially became registered as an
Investment Adviser Firm in May of 2001 and became registered with the SEC in June
2018. The Registrant is wholly owned by Brian Wruk, the Registrant’s President and Chief
Compliance Officer.
B. As discussed below, the Registrant offers to its clients (individuals, high net worth
individuals, pension and profit-sharing plans, trusts, estates, etc.) investment advisory
services, and, to the extent specifically requested by a client, financial planning and related
consulting services.
INVESTMENT ADVISORY SERVICES
The client can only engage the Registrant to provide discretionary investment advisory
services on a fee-only basis. The Registrant’s annual investment advisory fee is based upon
a percentage (%) of the market value of the assets placed under the Registrant’s
management.
Registrant’s annual investment advisory fee shall include investment advisory services,
and, to the extent specifically requested by the client, financial planning and consulting
services. In the event that the client requires extraordinary planning and/or consultation
services (to be determined in the sole discretion of the Registrant), the Registrant may
determine to charge for such additional services pursuant to a stand-alone Financial
Planning Agreement (see below).
The Registrant provides investment advisory services specific to the needs of each client.
Before providing investment advisory services, an investment adviser representative will
ascertain each client’s investment objective(s). Thereafter, the Registrant will allocate
investment assets consistent with the designated investment objective(s). The Registrant
primarily allocates client investment assets among various no-load or load-waived mutual
funds, individual equities (stocks), and debts (bonds) on a discretionary basis in accordance
with the client’s designated investment objective(s). Once allocated, the Registrant
provides ongoing monitoring and review of account performance, asset allocation and
client investment objectives.
FINANCIAL PLANNING AND CONSULTING (STAND-ALONE)
To the extent requested by a client, the Registrant may determine to provide financial
planning and/or consulting services (including investment and non-investment related
matters, including estate planning, insurance planning, etc.) on a stand-alone separate fee
basis.
Financial Planning
The Registrant provides financial planning advice in the form of a comprehensive
financial plan. Clients purchasing this service will receive a written report, providing the
client with a detailed financial plan designed to help achieve his or her stated financial goals
and objectives. The Registrant specializes in financial planning services for both
domestically domiciled individuals, as well as those intending to change their place of
residence from the United States to Canada or vice versa. A custom-tailored financial plan
starts with a thorough goals and objectives setting process and contains specific
recommendations on all aspects of a client’s financial situation. The financial plans do not
include the recommendations of specific investment vehicles nor the development of an
Investment Policy Statement (“IPS”). Depending on their individual needs and
circumstances, clients may utilize the following programs offered by the Registrant:
Realizing the Dream™ - a comprehensive financial planning service for domestic U.S. or
Canadian clients considering, or who have completed, a transition in life (retirement,
passing of a spouse, purchase of a second home, departed children, etc.) but with no cross
border issues. Fees generally start at $3,000 and can range upwards of $100,000 as
calculated using the fee schedule below:
Net Worth Retirement Plans Other Properties
0 - 1M 0.60% 0 - 300k 0.30% 0 - 300k 0.45%
1M - 3M 0.45% 300k - 500k 0.20% 300k - 500k 0.30%
3M - 5M 0.30% 500k - 1M 0.10% 500k - 1M 0.15%
5M + 0.15% 1M + 0.05% 1M + 0.075%
The fee is based on net worth with retirement plans and other properties added as a
surcharge for additional complexity.
The Canadian in America™ - a comprehensive financial planning service for those clients
considering, or who have already completed, a transition from Canada to the United States.
Fees generally start at $5,000 and can range upwards of $100,000 as calculated using the
fee schedule below:
Net Worth RRSP/RRIF/LIRA/LIF Other Properties
0 - 1M 0.60% 0 - 300k 0.30% 0 - 300k 0.45%
1M - 3M 0.45% 300k - 500k 0.20% 300k - 500k 0.30%
3M - 5M 0.30% 500k - 1M 0.10% 500k - 1M 0.15%
5M + 0.15% 1M + 0.05% 1M + 0.075%
The American in Canada™ - a comprehensive financial planning service for those clients
considering, or who have completed, a transition from the United States to Canada. Fees
generally start at $5,000 and can range upwards of $100,000 as calculated using the fee
schedule below:
Net Worth Retirement Plans Other Properties
0 - 1M 0.60% 0 - 300k 0.30% 0 - 300k 0.45%
1M - 3M 0.45% 300k - 500k 0.20% 300k - 500k 0.30%
3M - 5M 0.30% 500k - 1M 0.10% 500k - 1M 0.15%
5M + 0.15% 1M + 0.05% 1M + 0.075%
In general, the financial plan will address any or all of the following areas of concern:
Cash management, income tax planning, independence planning, education planning, risk
management, investment planning, estate planning, immigration planning, and customs
planning. The Registrant gathers required information through in-depth personal
interviews. Information gathered includes a client’s current financial status, future goals
and attitudes towards risk. Related documents supplied by the client are carefully reviewed,
including a questionnaire completed by the client, and a written report is prepared.
Consulting Services
Clients can also receive investment advice on a much more limited basis. This may include
advice on only an isolated area(s) of concern such as estate planning, retirement planning,
reviewing a client’s existing portfolio, residency planning, or any other specific topic.
Transition also provides specific consultation and administrative services regarding
investment and financial concerns of the client.
Registrant’s planning and consulting fees are negotiable depending upon the level and
scope of the service(s) required and the professional(s) rendering the service(s). Prior to
engaging the Registrant to provide planning or consulting services, clients are required to
enter into a Financial Planning and Consulting Agreement with Registrant setting forth the
terms and conditions of the engagement (including termination), describing the scope of
the services to be provided, and the portion of the fee that is due from the client prior to
Registrant commencing services. To the extent requested by a client, Registrant may
recommend the services of other professionals for non-investment implementation
purposes. The client retains absolute discretion over all such implementation decisions and
is free to accept or reject any recommendation from Registrant and/or its representatives.
If the client engages any unaffiliated professional, recommended or otherwise, and a
dispute arises thereafter relative to such engagement, the client agrees to seek recourse
exclusively from the engaged professional. At all times, the engaged licensed
professional(s), and not Registrant, shall be responsible for the quality and competency of
the services provided. Please Also Note: It remains the client’s responsibility to promptly
notify the Registrant if there is ever any change in his/her/its financial situation or
investment objectives for the purpose of reviewing/evaluating/revising Registrant’s
previous recommendations and/or services.
Tax Preparation. To the extent requested by a client, the Registrant may provide tax
preparation services. These services are separate from the investment advisory and
financial planning and consulting services offered by the Registrant and, therefore, are
provided for an additional fee.
MISCELLANEOUS
Limitations of Financial Planning and Non-Investment Consulting/Implementation
Services. To the extent requested by a client, Registrant may provide financial planning
and related consulting services regarding non-investment related matters, such as estate
planning, tax planning, insurance, etc. The Registrant does not serve as a law firm,
accounting firm, or insurance agency, and no portion of Registrant’s services should be
construed as legal, accounting, or insurance implementation services. Accordingly,
Registrant does not prepare estate planning documents or sell insurance products. To the
extent requested by a client, Registrant may recommend the services of other professionals
for certain non-investment implementation purposes (i.e. attorneys, accountants, insurance
agents, etc.). Clients are reminded that they are under no obligation to engage the services
of any such recommended professional. The client retains absolute discretion over all such
implementation decisions and is free to accept or reject any recommendation made by
Registrant or its representatives. Please Note: If the client engages any professional,
recommended or otherwise, and a dispute arises thereafter relative to such engagement, the
client agrees to seek recourse exclusively from the engaged professional. At all times, the
engaged licensed professional(s), and not Registrant, shall be responsible for the quality
and competency of the services provided.
Trade Error Policy. Registrant shall reimburse accounts for losses resulting from the
Registrant’s trade errors, but shall not credit accounts for such errors resulting in market
gains. The gains and losses are reconciled within the Registrant’s custodian firm account
and Registrant retains the net gains and losses.
Client Obligations. In performing its services, Registrant shall not be required to verify
any information received from the client or from the client’s other designated professionals,
and is expressly authorized to rely thereon. Moreover, each client is advised that it remains
their responsibility to promptly notify Registrant if there is ever any change in their
financial situation or investment objectives for the purpose of
reviewing/evaluating/revising Registrant’s previous recommendations and/or services.
Retirement Rollovers – No Obligation / Conflict of Interest: A client or prospective
client leaving an employer typically has four options regarding an existing retirement plan
(and may engage in a combination of these options): (i) leave the money in the former
employer’s plan, if permitted, (ii) roll over the assets to the new employer’s plan, if one is
available and rollovers are permitted, (iii) roll over to an Individual Retirement Account
(“IRA”), or (iv) cash out the account value (which could, depending upon the client’s age,
result in adverse tax consequences). If the Registrant recommends that a client roll over
their retirement plan assets into an account to be managed by the Registrant, such a
recommendation creates a conflict of interest if the Registrant will earn a new (or increase
its current) advisory fee as a result of the rollover If Registrant provides a recommendation
as to whether a client should engage in a rollover or not (whether it is from an employer’s
plan or an existing IRA), Registrant is acting as a fiduciary 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.. No client is under any
obligation to roll over retirement plan assets to an account managed by Registrant,
whether it is from an employer’s plan or an existing IRA. The Registrant’ Chief
Compliance Officer, Brian Wruk, remains available to address any questions that a
client or prospective client may have regarding the potential for conflict
of interest
presented by such rollover recommendation.
Independent Managers. Registrant may allocate a portion of a client’s investment assets
among unaffiliated independent investment managers (“Independent Manager(s)”) in
accordance with the client’s designated investment objective(s). In such situations, the
Independent Manager(s) will have day-to- day responsibility for the active discretionary
management of the allocated assets. Registrant will continue to render investment
supervisory services to the client relative to the ongoing monitoring and review of account
performance, asset allocation and client investment objectives. The factors Registrant
considers in recommending Independent Manager(s) include the client’s designated
investment objective(s), management style, performance, reputation, financial strength,
reporting, pricing, and research. The investment management fee charged by the
Independent Manager(s) is separate from, and in addition to, Registrant’s advisory fee as
set forth in Item 5.
Use of Mutual Funds and Exchange Traded Funds (“ETFs”): While the Registrant may
recommend allocating investment assets to mutual funds and ETFs that are not available
directly to the public, the Registrant may also recommend that clients allocate investment
assets to publicly-available mutual funds and ETFs that the client could obtain without
engaging Registrant as an investment adviser. However, if a client or prospective client
determines to allocate investment assets to publicly-available mutual funds and ETFs
without engaging Registrant as an investment adviser, the client or prospective client would
not receive the benefit of Registrant’s initial and ongoing investment advisory services.
Other mutual funds, such as those issued by Dimensional Fund Advisors (“DFA”), are
generally only available through certain registered investment advisers. Registrant
currently maintains investment positions in DFA funds but does not anticipate establishing
new positions or adding to existing positions in the future. With respect to investments in
DFA funds, restrictions regarding additional purchases, transferability, and/or reallocation
will apply upon the termination of Registrant’s services to a client. Registrant’s Chief
Compliance Officer, Brian Wruk, remains available to address any questions that a
client or prospective client may have regarding the above.
Trustee Directed Plans. Registrant may be engaged to provide discretionary investment
advisory services to ERISA retirement plans, whereby the Firm shall manage Plan assets
consistent with the investment objective designated by the Plan trustees. In such
engagements, Registrant will serve as an investment fiduciary as that term is defined under
The Employee Retirement Income Security Act of 1974 (“ERISA”). Registrant will
generally provide services on an “assets under management” fee basis per the terms and
conditions of an Investment Advisory Agreement between the Plan and the Firm
Portfolio Activity. Registrant has a fiduciary duty to provide services consistent with the
client’s best interest. As part of its investment advisory services, Registrant will review
client portfolios on an ongoing basis to determine if any changes are necessary based upon
various factors, including, but not limited to, investment performance, mutual fund
manager tenure, style drift, and/or a change in the client’s investment objective. Based
upon these factors, there may be extended periods of time when Registrant determines that
changes to a client’s portfolio are neither necessary nor prudent. Clients nonetheless remain
subject to the fees described in Item 5 below during periods of account inactivity. Of
course, as indicated below, there can be no assurance that investment decisions made by
Registrant will be profitable or equal any specific performance level(s).
Cash Sweep Accounts. Account custodians generally require that cash proceeds from
account transactions or cash deposits be swept into and/or initially maintained in the
custodian’s sweep account. The yield on the sweep account is generally lower than those
available in money market accounts. To help mitigate this issue, Registrant shall generally
purchase a higher yielding money market fund available on the custodian’s platform with
cash proceeds or deposits, unless Registrant reasonably anticipates that it will utilize the
cash proceeds during the subsequent 30-day period to purchase additional investments for
the client’s account. Exceptions and/or modifications can and will occur with respect to all
or a portion of the cash balances for various reasons, including, but not limited to, the
amount of dispersion between the sweep account and a money market fund, an indication
from the client of an imminent need for such cash, or the client has a demonstrated history
of writing checks from the account.
Cybersecurity Risk. The information technology systems and networks that Registrant
and its third-party service providers use to provide services to Registrant’s clients employ
various controls, which are designed to prevent cybersecurity incidents stemming from
intentional or unintentional actions that could cause significant interruptions in Registrant’s
operations and result in the unauthorized acquisition or use of clients’ confidential or non-
public personal information. Clients and Registrant are nonetheless subject to the risk of
cybersecurity incidents that could ultimately cause them to incur losses, including for
example: financial losses, cost and reputational damage to respond to regulatory
obligations, other costs associated with corrective measures, and loss from damage or
interruption to systems. Although Registrant has established its systems to reduce the risk
of cybersecurity incidents from coming to fruition, there is no guarantee that these efforts
will always be successful, especially considering that Registrant does not directly control
the cybersecurity measures and policies employed by third-party service providers. Clients
could incur similar adverse consequences resulting from cybersecurity incidents that more
directly affect issuers of securities in which those clients invest, broker-dealers, qualified
custodians, governmental and other regulatory authorities, exchange and other financial
market operators, or other financial institutions.
Tax Preparation Outsourced Service. Registrant provides income tax preparation and
tax planning advice. The Registrant outsources selected tax returns to an unaffiliated
outside accounting firm. Normally, Registrant will only prepare income tax returns for
individuals and small businesses. Income tax preparation services are typically offered to
Registrant’s advisory clients, but may be extended to other non-advisory customers as well.
Fees for preparing a tax return will generally range from $300 to $5,000, depending on the
complexity of the client's situation. Registrant’s clients may be offered a discount on their
tax preparation fees. Tax preparation fees are separate and are NOT included as part of any
investment advisory agreement. Registrant may decline to prepare any income tax return
due to the complexity and scope involved. Fees are normally assessed based on the forms
associated with the client’s return. As such, the more forms in a return, the higher the
associated fee. There is no requirement that any advisory clients have their income tax
returns prepared by the Registrant. Fees for services rendered are due after the
consultations are completed.
Variable Annuity Account Sub-divisions. Registrant may also render discretionary
investment management services to clients relative to variable annuity products that they
may own. In so doing, Registrant directs the allocation of client assets among the various
mutual fund sub-divisions which comprise the variable annuity product based upon the
investment objectives of the client. The insurance company that issues the variable annuity,
or its outside custodian, will maintain custody of the client’s funds and securities at all
times. Our authority is limited to exchanges among the variable annuity investment sub-
accounts. At no time will Registrant have authority to withdraw funds and/or securities
from the client’s variable annuity account. The Client Agreement will specifically state
which variable annuity policies are being managed. Registrant will not receive commission
compensation with respect to Client’s purchase of the variable annuity product.
Please Note: Socially Responsible Investing Limitations. Socially Responsible
Investing involves the incorporation of Environmental, Social and Governance
considerations into the investment due diligence process (“ESG). There are potential
limitations associated with allocating a portion of an investment portfolio in ESG securities
(i.e., securities that have a mandate to avoid, when possible, investments in such products
as alcohol, tobacco, firearms, oil drilling, gambling, etc.). The number of these securities
may be limited when compared to those that do not maintain such a mandate. ESG
securities could underperform broad market indices. Investors must accept these
limitations, including potential for underperformance. Correspondingly, the number of
ESG mutual funds and exchange traded funds are few when compared to those that do not
maintain such a mandate. As with any type of investment (including any investment and/or
investment strategies recommended and/or undertaken by Registrant), there can be no
assurance that investment in ESG securities or funds will be profitable, or prove
successful.
Please Note: Cash Positions. Registrant continues to treat cash as an asset class. As such,
unless determined to the contrary by Registrant, all cash positions (money markets, etc.)
shall continue to be included as part of assets under management for purposes of
calculating Registrant’s advisory fee. At any specific point in time, depending upon
perceived or anticipated market conditions/events (there being no guarantee that such
anticipated market conditions/events will occur), Registrant may maintain cash positions
for defensive purposes. In addition, while assets are maintained in cash, such amounts
could miss market advances. Depending upon current yields, at any point in time,
Registrant’s advisory fee could exceed the interest paid by the client’s money market fund.
ANY QUESTIONS: The Registrant’s Chief Compliance Officer, Brian Wruk, remains
available to address any questions that a client or prospective may have regarding the above
fee billing practice.
Client Obligations. In performing its services, Registrant shall not be required to verify
any information received from the client or from the client’s other professionals and is
expressly authorized to rely thereon. Moreover, each client is advised that it remains their
responsibility to promptly notify the Registrant if there is ever any change in their 7
financial situation or investment objectives for the purpose of reviewing, evaluating or
revising Registrant’s previous recommendations and/or services
Disclosure Statement. A copy of the Registrant’s written Brochure as set forth on Form
ADV Part 2, along with our Form CRS (Relationship Summary) shall be provided to each
client prior to, or contemporaneously with, the execution of the Investment Advisory
Agreement or Financial Planning and Consulting Agreement.
C. The Registrant shall provide investment advisory services specific to the needs of each
client. Prior to providing investment advisory services, an investment adviser
representative will ascertain each client’s investment objective(s). Thereafter, the
Registrant shall allocate and/or recommend that the client allocate investment assets
consistent with the designated investment objective(s). The client may, at anytime, impose
reasonable restrictions, in writing, on the Registrant’s services.
D. The Registrant does not participate in a wrap fee program.
E. As of December 31, 2022, the Registrant had $189,778,330 in assets under management
on a discretionary basis.