Financial Advocates Wealth Management, LLC (“FAWM,” “us,” “we,” “our”) is registered with the Securities and Exchange
Commission (SEC) as a n investment adviser. FAWM is a limited liability company formed in the State of Washington in April
2019. While FAWM is a new adviser, it is related through common control to other investment advisers, Financial Advocates
Investment Management, LLC (“FAIM”) and Financial Advocates Advisory Services, LLC (“FAAS”). FAIM has been in business
since 2010 and FAAS since 2008. FAWM is 100% owned by FA Holdings, Inc. The group of affiliated companies is referred to
collectively as “Financial Advocates.”
The Financial Advocates business model is based on a decentralized network of Investment Adviser Representatives (“IARs”
or “Consultants”) with offices located in numerous states and cities. Although all of FAWM’s IARs are registered with, and
subject to oversight and supervision by, FAWM, they operate their businesses independently and some offices work under a
separate business name or “DBA”. IARs associated with FAWM may provide IAR services to clients under a DBA name that is
owned and registered by the IAR or the group of IARs which the DBA name represents. As such, marketing materials provided
to clients and potential clients may include the DBA name and may include a logo associated with the DBA name. FAWM
continues to review and approve marketing materials related to the IAR or IA firm services offered and provided to clients.
FAWM supervises IARs in the performance of their IAR duties whether the services are performed under the IAR’s name, the
DBA name, or the FAWM name. If properly disclosed as an outside business activity of the IAR, FAWM allows IARs to provide
other products and services through their DBA so long as they are unrelated to FAWM’s IA business. These outside business
activities are not associated with or supervised by FAWM. Because all of our IARs operate their businesses independently
from one another, they have significant flexibility in providing tailored individualized investment advice to clients. FAWM’s
home office in Olympia, WA, assists the IARs with marketing, back-office functions and compliance responsibilities. A list of
all of the FAWM approved DBA names can be found on our Schedule D, Section 1.B. Other Business Names of our Form ADV
Part 1 which is available on the SEC’s Investment Advisor Public Disclosure website at www.adviserinfo.sec.gov.
FAWM as a whole offers the following types of services: investment management, hourly consulting, financial planning and
consultations, and pension consulting services. Individual IARs offer investment advice to clients utilizing some or all of these
services. The following paragraphs describe our services and fees.
Asset Management
As part of our asset management services, we create a portfolio for each client, consisting of individual stocks or bonds, exchange
traded funds (“ETFs”), options, mutual funds and/or other public and private securities or investments. The client’s individual
investment strategy is tailored to their specific needs and may include some or all of the previously mentioned securities. Each
portfolio will be initially designed to meet a particular investment goal, which we determine to be suitable to the client’s
circumstances. Once the appropriate portfolio has been determined, we have ongoing discretionary authority. We review the
overall portfolio at least quarterly and, if necessary, rebalance based upon the client’s individual needs, stated goals and
objectives. Each client has the opportunity to place reasonable restrictions on the types of investments to be held in the portfolio.
In designing an investment portfolio for a client, we may work with a third party money manager, also an investment adviser, who
is independent of FAWM. When we work with third party money managers, we’re utilizing that money manager’s experience
and strategies, helping to develop a suitable portfolio for each client. We conduct initial and ongoing due diligence on any money
manager utilized. We also have discretionary authority to add and remove money managers within your investment portfolio.
We make sure other advisers are properly registered before we begin working with them.
Wrap Fee Programs:
“Wrap fee programs” are advisory programs under which a specified fee or fees, not based directly upon transactions in a
client’s account, is charged for both investment advisory services and the execution of client transactions. We make wrap
programs available to our clients. Depending on, among other things, the size of the account, changes in its value over time,
the ability to negotiate fees or commissions, and the number of transactions, the amount of the compensation we receive
through wrap programs may be more or less than what we would receive if the client participated in different fee programs
or paid separately for investment advice, brokerage and other services. Similarly, services may cost clients more or less than
if they paid for the services separately.
Where we earn additional compensation due to the client’s participation in a wrap fee program, we have a financial incentive
to recommend these programs over other programs where our compensation is lower. This creates a conflict of interest,
which we mitigate by fully disclosing our compensation and the choices available to clients, and by making recommendations
consistent with our fiduciary duties to clients.
There is not a material difference in how we manage wrap fee accounts and how we manage other accounts.
Double Leaf Portfolio Solutions
Double Leaf Portfolio Solutions is a wrap fee program sponsored by our affiliate, Financial Advocates Investment
Management (“FAIM”). Clients interested in this program will receive a separate disclosure Brochure Appendix describing the
program in more detail. Double Leaf Portfolio Solutions are financial models created for use by our IARs for their clients. FAIM
has partnered with Horizon Investments, LLC, an unaffiliated investment adviser, to create models that are designed with the
client’s investment lifecycle in mind. Horizon Investments is responsible for the portfolio construction and selection of the
underlying investments with input and approval from FAIM. Horizon does not have knowledge of, or interaction, with the
end-clients utilizing these models.
Double Leaf Growth portfolios are designed for clients who are the wealth accumulation stage of their investment
lifecycle. There are five globally diverse options, each are balanced with active and passive management to achieve
growth in a cost effective manner. These options seek to achieve flexibility while also being focused on the client’s
long term objectives. The five models include Double Leaf Aggressive Growth, Double Leaf Growth, Double Leaf
Moderate, Double Leaf Conservative and Double Leaf Ultra Conservative.
Double Leaf Prepare portfolios are designed to help clients with the preservation of wealth stage of their investment
lifecycle. The Double Leaf Prepare portfolios singularly prioritize risk management above market returns. The models
are Double Leaf Aggressive with Risk Management, Double Leaf Growth with Risk Management, Double Leaf
Moderate Growth with Risk Management, Double Leaf Conservative with Risk Management and Double Leaf Ultra
Conservative with Risk Management.
Double Leaf Retire portfolios are designed for clients who are at the distribution of wealth stage of their investment
lifecycle. The Double Leaf Retire portfolios seek to increase the likelihood that the client doesn’t outlive their assets
and are designed specifically with longevity in mind. The models are Double Leaf 6% Spend, Double Leaf 5% Spend
and Double Leaf 4% Spend.
Other Wrap Programs
We expect to make other wrap fee programs available through unaffiliated sponsors. If we recommend one of these
programs, clients will receive the sponsor’s disclosure documents prior to our investing client assets in the program.
Third Party Asset Management Programs
FAWM makes available advisory services and programs of third party asset managers. Under these programs, FAWM’s IARs
provide ongoing investment advice to clients that is tailored to the individual needs of the client, assisting the client in
determining suitability of the program, setting investment objectives and processing the paperwork with the third party asset
manager. The IAR may also assist the client in selecting the model portfolio designed by the asset manager. When selecting
third-party managers, FAWM retains discretionary authority to hire new managers or to terminate existing managers, but
does not have discretionary authority
to select individual investments.
Consulting Services, Targeted Financial Planning
Some FAWM IARs may offer consulting services, including financial planning in specific areas. These targeted financial planning
services are based on an analysis of the client’s current financial circumstances, goals and objectives with respect to
a limited focus area. Typically, targeted financial planning and consulting services involve a process of information gathering
by the IAR, analysis of the client’s needs or goals, typically followed by a meeting to discuss FAWM’s recommendations and
to establish next steps for the client. Targeted financial planning does not usually result in a written plan or report.
Financial planning services or hourly consulting services may include analysis or discussion in one or more of the following
areas:
Charitable Planning
Education Planning
Cost Segregation Study
Mortgage/Debt Analysis
Insurance Analysis
Lines of Credit Evaluation
Business and Personal Financial Planning
Clients enter into a Consulting Agreement for financial planning and other consulting services. These services vary depending
on each client’s needs, but may include any of the above-listed services.
FAWM is not qualified to offer legal or accounting advice and we refer clients to an accountant, attorney or other specialist
as necessary for non-advisory related services.
Comprehensive Financial Planning
Generally, comprehensive financial planning services are based on an analysis of the client’s current financial circumstances,
goals and objectives. This involves a process of information gathering by the IAR, then preparation of a financial plan or other
written report. Specifically, comprehensive financial planning will address one or more of the six key areas of financial
planning:
Financial Position
Protection Planning
Investment Planning
Corporate and Personal Income Tax Planning
Retirement Planning
Estate Planning.
Our written financial plans provided to clients or financial planning consultations rendered to clients usually include general
recommendations for a course of activity or specific actions to be taken by the clients. For example, recommendations may
be made that the clients begin or revise investment programs, create or revise wills or trusts, obtain or revise insurance
coverage, commence or alter retirement savings, or establish education or charitable giving programs.
For comprehensive financial planning engagements, we provide our clients with a written summary of their financial situation,
observations and recommendations. Financial plans or consultations are typically completed within six (6) months of a client’s
signing a contract with us, assuming that all the information and documents we request from the client are provided to us
promptly. Implementation of the recommendations will be at the discretion of the client. Clients are free to implement
investment recommendations through brokers unaffiliated with FAWM or its IARs.
Hourly Consulting Services
General hourly consulting services are provided for a variety of purposes including, but not limited to:
Annual Update to Financial Plan
Asset Allocation Recommendations
Portfolio Management Recommendations
Individual Issue Consulting
Third party review (2nd opinion)
For hourly consulting engagements, we usually do not provide our clients with a written summary of our observations and
recommendations as the process is less formal than our financial planning services. Implementation of any recommendations
or next steps to be taken will be at the discretion of the client.
Investment Fiduciary & Retirement Plan Consulting
We provide consulting and advisory services for employer-sponsored retirement plans that are designed to assist plan
sponsors of employee benefit plans (“Sponsor”). These services are offered to the Sponsors on a one-time or ongoing basis.
Generally, such pension consulting services consist of assisting the Sponsor in establishing, monitoring and reviewing their
company's participant-directed retirement plan. As the needs of the Sponsor dictate, areas of advising could include, but are
not limited to, investment options, plan structure and participant education.
Where we offer plan participants the option of using our Participant Advisory Services for discretionary investment
management services, we’ll enter into a separate agreement with that participant, describing our services and fees for that
service. We also ask that the participant provide information that will help us understand their investment objectives. In
providing this service, we are deemed to be a fiduciary and investment manager as defined in ERISA Section 3(38).
All pension consulting services shall be in compliance with the applicable state law(s) regulating pension consulting services.
This applies to client accounts that are pension or other employee benefit plans (“Plan”) governed by the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”). If the client accounts are part of a Plan, and we accept
appointments to provide our services to such accounts, we acknowledge our fiduciary role within the meaning of Section
3(21) of ERISA, but only with respect to the provision of services described in the Services section of the Investment Fiduciary
& Retirement Plan Consulting Agreement (“RPAC”). When providing any ERISA fiduciary services, we will solely be making
recommendations to the Sponsor and the Sponsor retains full discretionary authority and/or control over the assets.
When entering into an RPAC agreement, the Plan Sponsor may select from a number of different services described below.
With the exception of Participant Advisory Services, FAWM will be acting in a non-discretionary capacity and will solely be
making recommendations to the Plan Sponsor. FAWM will not perform recordkeeping or brokerage services to the Plan.
Neither FAWM nor the IAR will assume the duties of a trustee or a Plan Administrator, as defined in ERISA Sec. 3(16).
Services offered under an RPAC agreement are described below.
Investment Fiduciary Services: Plan-Level
Recommendations to establish or revise the Plan’s Investment Policy Statement (“IPS”),
Recommendations to select and monitor the Designated Investment Alternatives (“DIAs”),
Recommendations to select and monitor Qualified Default Investment Alternatives (“QDIAs)
Recommendation to select and monitor other investment managers
Investment Fiduciary Services: Participant Level
IAR will meet with Plan Participants periodically, or upon reasonable request, to collect information necessary to
provide individual participants with investment advice and related services regarding the investment options
available under the Plan.
IAR will manage the Participant’s account on a discretionary basis.
Administrative Support
Retirement Plan Consulting Services
oAssist Plan Sponsor in reviewing objectives and options through the Plan
oReview of Plan committee structure and administrative policies & procedures
oRecommend participant education and communications policies under ERISA 404(c)
oAssist with development/maintenance of fiduciary audit file and document retention policies
oDeliver fiduciary training and/or education periodically or upon reasonable request.
oCoordinate and reconcile participant disclosures under 404(a)(5)
oDevelop requirements for responding to participant requests
Oversight of Relationship with Service Provider
oAssist with process to select, monitor and replace service providers
oAssist with review of Covered Service Providers (CSP) disclosures under ERISA 408(b)(2) and fee
benchmarking
oProvide reports and/or information designed to assist with monitoring CSPs
oReview ERISA Spending Accounts or Plan Expense Recapture Accounts
oAssist with preparation and review of Request for Proposals (RFPs) and/or Request for Information (RFIs)
oCoordinate and assist with CSP replacement and conversion
Investments
oPeriodic review of investment policy in context of Plan objectives
oAssist Plan committee with monitoring investment performance
oProvide analysis of investment managers and model portfolios
oReview and recommend Designated Investment Managers and/or third-party advice providers as necessary
oEducate Plan committee members, as needed, regarding replacement of DIA(s) and/or QDIA(s)
Participant Services
oFacilitate group enrollment meetings
oCoordinate employee education regarding Plan investments and fees
oAssist Plan participants in understanding Plan benefits, retirement readiness and impact of increasing
deferrals.
Assets Under Management
As of December 31, 2022, we had no assets under management.