Financial Counseling, Inc. was formed in July 1995 and is a corporation organized in the State of Ohio.
Stevan M. Vaughan is the President and sole owner. Financial Counseling, Inc. provides “fee for service”
financial planning and investment advice. Areas of advice include asset allocation, investment selection,
retirement planning, college funding and employee benefits and qualified plan subaccount analysis.
Engagements are limited in scope based on the client’s unique circumstances. As of December 31,
2023, FCI manages approximately $90 million in assets. The managed assets are $89.3 million on a
discretionary basis, with $700,000.00 managed on a non-discretionary basis.
The Adviser gathers financial data including the client’s goals, circumstances, financial condition and risk
tolerance. The adviser then prepares and delivers analysis and recommendations to the client.
Recommendations may be in a written/electronic format, or in the form of verbal (in-person or phone)
discussion, or both.
Clients engage Financial Counseling, Inc. on a “pay as you go” basis. The services a client receives are
dependent upon the individual needs and requests by the client, but often times the services rendered
are continuous and on-going. The investment management services provided by Financial Counseling,
Inc. often involve investment modeling where trades are conducted with the use of Adviser discretion.
The Adviser will perform “active” management to a client’s account in accord with pre-
described/defined goals and risk tolerances provided by the client. When discretionary authority has
been given to Financial Counseling, Inc. or one of the IARs of FCI and company, this allows FCI to “take
action” without first receiving approval from the client. The “action” is limited to purchases and/or sales
of securities (Stocks/Bonds/Mutual Funds/ETFs…), but does not allow the Adviser to move funds
between accounts or transfer assets from the account. All transactions occur at a qualified custodian
that produces statements. These statements may be produced monthly, but must be produced at least
quarterly and contain the basic account value and holdings of the managed accounts along with listing
the activity that occurs within the account(s) being managed by FCI. The statement provided by the
custodian will also contain the advisory fee charged by FCI. Fees charged by FCI are separate from the
fees charged by Mutual Funds and other investment companies. Therefore, FCI recommends consulting
the Mutual Fund prospectus for more information about their fees. More information is available about
the Active Management program under Item 8 of this document.
FCI also provides long term buy and hold services that do not involve active management of client
accounts. Clients may choose a service that offers asset allocation services that are managed by FCI that
make less active transactions and is designed to keep expenses low, while offering market related rates
of return. If services are selected that do not entail discretionary authority, then clients are free to
implement all, some, or none of the Adviser’s recommendations and the full responsibility of
implementation rests with the client.
FCI offers services of Third Party Investment Advisers to manage portfolios on behalf of clients. Prior to
selecting other advisors FCI validates that the entity is properly licensed or registered as an investment
adviser. If the Client engages a Third-Party Investment Adviser, at the IARs recommendation, the fees,
and their method of calculation, are carefully described in the Third-Party Investment Adviser’s
Disclosure Brochure. The client should consult the third-party adviser’s Disclosure Brochure to
determine: (a) if compensation is payable before the service is provided; (b) when compensation is
payable; (c) how a client may get a refund; and (d) how a client may terminate an advisory contract
before its expiration date. Such fees may be negotiable. A
portion of the fees charged to the Client by
the Third-Party Investment Adviser is allocated to FCI and the IAR for introducing accounts to the
advisor. Clients are not charged a higher rate for being referred to a Third Party Adviser.
Client- tailored advisory services are based on the individual needs of clients. This is accomplished
through specific meetings and interviews, both face to face and via phone or electronic communication
with the client. The services t h a t we offer are individually client focused and each client will
prepare written statements of objectives and risk tolerances for the Adviser to acknowledge while
providing advisory services. While clients may impose restrictions regarding certain types of
securities, those restrictions should be provided to the Adviser in writing so we can appropriately
document and adhere to those wishes of the client. It is possible, that even though we provided
individualized investment advice, clients may qualify for investment models that include many clients
of similar goals and circumstance with regard to investment objectives and risk tolerances. Therefore,
other clients may be invested in substantially similar fashion, but each client is able to make
independent action with their accounts by contacting the Adviser and giving them independent
instruction.
When clients request services related to financial planning a conflict exists between the interests of the
investment adviser and the interests of the client. The client is under no obligation to act upon the
investment adviser's recommendation, and if the client elects to act on any of the recommendations,
the client is under no obligation to effect the transaction through the investment adviser. Clients are
free to take the advice offered and implement that advice through other unaffiliated advisors or
financial providers outside Financial Counseling, Inc. Please note, as described in Item 10 and Item 12
of this document, if clients elect to use Financial Counseling, Inc. as the execution agent for the
financial plan, the members of Financial Counseling, Inc. will likely receive extra fee compensation
above and beyond the fees paid by client for the financial plan. Therefore, a conflict of interest may
exist to sell one product over another. Clients may be able to find similar services at a lesser cost at
other financial advisory firms.
As a registered investment adviser subject to Section 206 of the Advisers Act, FCI acts as a fiduciary related
to the conduct of its investment management and advisory services. As such, FCI has an obligation to act
in the best interest of its clients guided by the core fiduciary duties of loyalty and care.
FCI will adhere and comply with the following Impartial Conduct Standards:
(1) FCI will provide advice that is, at the time of the recommendation, in the Best Interest of the
Retirement Investor. Such advice shall reflect the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent person acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of like character and with like aims, based on the
investment objectives, risk tolerance, financial circumstances and needs of the client, without
regard to the financial or other interest of FCI or any affiliate, related entity or other party;
(2) The recommended transaction will not cause FCI or their affiliates or related entities to receive,
directly or indirectly, compensation for their services that is in excess of reasonable compensation
within the meaning of ERISA Section 408(b)(2) and Code Section 4975(d)(2).
(3) Statements by FCI to the client about the recommended transactions, fees and compensation,
material conflicts of interest and any other matters relevant to a client’s investment decisions, will
not be materially misleading at the time they are made.
(4) Stevan Vaughan, FCI’s Chief Compliance Officer is designated as the person available to discuss
matters such as conflicts of interest, potential conflicts of interest and FCI’s fiduciary status.