General Description of Advisory Firm
Deerfield Financial Advisors, Inc. (also referred to as Deerfield Financial Advisors, Deerfield, and the Firm)
is an investment advisor registered with the United States Securities and Exchange Commission (“SEC”)
and is a Corporation formed under the laws of the State of Indiana.
• The Firm’s President and Chief Operating Officer is Susie Steel.
• The Firm’s Vice President and Chief Investment Officer is Bradley Cougill.
• The Firm’s Chief Compliance Officer is Marsha Kalasmiki.
• Ms. Steel and Mr. Cougill are the controlling owners of the Firm.
• Deerfield Financial Advisors has been registered as an investment advisor since September 5,
1985.
• Through Deerfield Financial Advisors, we offer and consider ourselves to specialize in providing
personalized fee-only Financial Planning and Investment Advisory Services.
Description of Advisory Services
Clients are advised that the investment recommendations and advice we offer does not constitute legal or
accounting advice. Therefore, clients should coordinate and discuss the impact of financial advice with
their attorney and/or accountant. Clients are advised that it is necessary to inform Deerfield Financial
Advisors promptly with respect to any changes in their financial situation, investment goals and objectives.
Failure to notify Deerfield Financial Advisors of any such changes could result in investment
recommendations not meeting the needs of the client.
Deerfield Financial Advisors is not required to verify information received from a client or from the client's
other professionals (e.g., attorney, accountant, etc.) and is expressly authorized to rely on information
provided by clients. Deerfield Financial Advisors may recommend other professionals to implement certain
types of recommendations that we may not be able to implement ourselves or lack the necessary expertise.
Clients are under no obligation to act upon any of the recommendations made by Deerfield Financial
Advisors under a Financial Planning and Consulting engagement (including reports generated through our
Wealth Management Services) and/or engage the services of any recommended professional.
Wealth Management Services
Deerfield Financial Advisors provides advisory services in the form of Wealth Management Services which
can be described as a broad range of financial planning, investment management (see below), and financial
planning and investment consulting (see below). Through this service, we essentially combine our
Investment Management Services with consulting on other “non-managed” accounts while also developing
financial planning and advice (see Financial Planning and Consulting Services below).
Investment Management Services
We provide advisory services in the form of Investment Management Services. Investment Management
Services involve providing clients with continuous and on-going supervision over client accounts. This
means that Deerfield Financial Advisors will continuously monitor a client’s account and make trades in
client accounts when necessary.
Through this service, Deerfield Financial Advisors implements a customized and individualized investment
program for clients by applying our investment strategy and philosophy. Deerfield Financial Advisors shall
actively manage client investment portfolios in accordance with the client's individual needs, return
objectives and risk tolerance.
Investment Management Services are primarily provided through accounts at Charles Schwab & Company,
Inc. (“Charles Schwab”) as a result of the Firm’s participation in the Schwab Advisor Services platform.
Charles Schwab is a registered broker/dealer, members of the Financial Industry Regulatory Authority
(FINRA) and the Securities Investors Protection Corporation (SIPC) and will serve as the client’s qualified
custodian and maintain physical custody of all client funds and securities. We are also willing to manage
accounts held at other broker/dealers and qualified custodians selected by the client (conditional upon our
approval) including variable annuities owned by the client and accounts established directly at retirement
plan sponsors.
Clients must designate Deerfield Financial Advisors as their investment advisor on the accounts they’d like
us to manage. Deerfield Financial Advisors will be granted limited power-of-attorney on the account to
implement trades within the account and (when agreed to by the client) deduct the Deerfield Financial
Advisors advisory fees from the account. Please refer to Item 12 for more information regarding the Firm’s
brokerage arrangements.
Clients are always responsible for notifying Deerfield Financial Advisors of any changes to their financial
situation or investment objectives. At least annually, we will contact each client for the specific purpose to
determine whether the client’s financial situation or investment objectives have changed. We are always
reasonably available to consult with clients relative to the status of their accounts. A client’s beneficial
interest in a security does not represent an undivided interest in all the securities held by the custodian, but
rather represents a direct and beneficial interest in the securities which comprise the accounts. A separate
account is always maintained for each client with the broker-dealer/custodian and the client retains all rights
of ownership to their accounts (e. g. right to withdraw securities or cash, exercise or delegate proxy voting,
and receive transaction confirmations).
It is important to understand that Deerfield Financial Advisors manages investments for other clients and
can give them advice or take actions for them or for our personal accounts that is different from the advice
we provide to a particular client or actions we take on their behalf. We are not obligated to buy, sell or
recommend to a particular client any security or other investment that we may buy, sell or recommend for
any other clients or for our own accounts.
Conflicts can arise in the allocation of investment opportunities among accounts that we manage. We strive
to allocate investment opportunities believed appropriate for each client’s account(s) and other accounts
advised by our Firm among such accounts equitably and consistent with the best interests of all accounts
involved. However, there can be no assurance that a particular investment opportunity that comes to our
attention will be allocated in any particular manner. If we obtain material, non-public information about a
security or its issuer that we may not lawfully use or disclose, we have absolutely no obligation to disclose
the information to any client or use it for any client’s benefit.
Clients can make additions to their accounts in cash or securities provided that Deerfield Financial Advisors
reserves the right to liquidate any transferred securities or decline to accept particular securities into a
client's account. Deerfield Financial Advisors will consult with clients about the options and ramifications
of transferring securities. However, clients are advised that when transferred securities are liquidated, they
are subject to transaction fees, fees assessed at the mutual fund level (i.e., contingent deferred sales
charge) and/or tax ramifications.
Investment Management Services through Schwab Institutional Intelligent Portfolios Program
For clients with small account sizes, we can recommend the use of and provide portfolio management
services through Institutional Intelligent Portfolios™, an automated, online investment management
platform for use by independent investment advisors and sponsored by Schwab Wealth Investment
Advisory, Inc. (the “Program” and “SWIA,” respectively). Through the Program, we offer clients with smaller
account sizes a range of investment strategies we have constructed and manage, each consisting of a
portfolio of exchange traded funds (“ETFs”) and a cash allocation. The client can instruct us to exclude up
to three ETFs from their portfolio. The client’s portfolio is held in a brokerage account opened by the client
at Charles Schwab, an affiliated company of SWIA. The Program is described in the Schwab Wealth
Investment Advisory, Inc. Institutional Intelligent Portfolios™ Disclosure Brochure (the “Program Disclosure
Brochure”), which is delivered to clients by SWIA during the online enrollment process.
We, and not Schwab, are the client’s investment advisor and primary point of contact with respect to the
Program. We are solely responsible, and Schwab is not responsible, for determining the appropriateness
of the Program for the client, choosing a suitable investment strategy and portfolio for the client’s investment
needs and goals, and managing that portfolio on an ongoing basis. SWIA’s role is limited to delivering the
Program Disclosure Brochure to clients and administering the Program so that it operates as described in
the Program Disclosure Brochure.
We have contracted with SWIA to provide us with the technology platform and related trading and account
management services for the Program. This platform enables us to make the Program available to clients
online and includes a system that automates certain key parts of our investment process (the “System”).
The System includes an online questionnaire that helps us determine the client’s investment objectives and
risk tolerance and select an appropriate investment strategy and portfolio. Clients should note that we will
recommend a portfolio via the System in response to the client’s answers to the online questionnaire. The
client may then indicate an interest in a portfolio that is one level less or more conservative or aggressive
than the recommended portfolio, but we then make the final decision and select a portfolio based on all the
information we have about the client. The System also includes an automated investment engine through
which we manage the client’s portfolio on an ongoing basis through automatic rebalancing and tax-loss
harvesting (if the client is eligible and elects).
Clients do not pay fees to SWIA in connection with the Program, but we charge clients a fee for our services
as described below under Item 5 Fees and Compensation. Our fees are not set or supervised by Schwab.
Clients do not pay brokerage commissions or any other fees to Charles Schwab as part of the Program.
But Charles Schwab does receive other revenues in connection with the Program, as described in the
Program Disclosure Brochure.
We do not pay Charles Schwab fees for its services in the Program so long as we maintain $100 million in
client assets in accounts at Charles Schwab that are not enrolled in the Program. If we do not meet this
condition, then we pay SWIA an annual fee of 0.10% (10 basis points) on the value of our clients’ assets in
the Program. This fee arrangement gives us an incentive to recommend or require that our clients with
accounts not enrolled in the Program be maintained with Charles Schwab. Please see additional
information regarding our arrangement with Charles Schwab at Item 12 of this brochure.
Financial Planning and Consulting Services
Financial Planning
We provide advisory services in the form of financial planning consultations and written financial
planning. Financial Planning Services do not involve the active management of client accounts, but
instead focus on a client’s overall financial situation. Financial planning can be described as helping
individuals determine and set their
long-term financial goals, through business planning,
investment
management
, tax and cash-flow planning, asset allocation, risk management, retirement planning,
estate planning, education planning, an
d other areas. T
he role of a financial planner is to find ways to
help the client understand his/her
overall financial situation and help th
e client set financia
l objectives.
Financial planning discussions begin at the onset of the relationship and are integrated into investment
planning while investments are transferred, or changes are initiated to portfolios that have been
transferred to Deerfield Financial Advisors for its Investment Management Services (see following
section). Financial Planning Services can be specific or modular in their preparation (unique to each
client in their depth of preparation). Specific issues covered in a financial plan are contingent upon
each client’s unique needs and circumstances, but the following are basic areas in which our planning
may focus.
• Business Planning
• Investment Management
• Insurance/Risk Management (Life, Disability, and Long-Term Care)
• Retirement Planning
• Education Planning
• Estate Planning
• Tax Planning and Cash Flow Needs Analysis
Financial Planning Services take into consideration factors such as a client’s financial/investment
objectives, risks they are willing to undertake, investment knowledge, net worth, income, age, projected
retirement, unusual or material funding requirements, inheritance possibilities, pensions, stock options,
social security, children/relative funding issues, estate issues, and living expenses expressed in today’s
dollars requested for retirement.
While Financial Planning Services are prepared with the intention of clients implementing
recommendations made within the plan through our Investment Management Services, they are not
obligated to do so. If clients elect to implement our advice provided as part of the Financial Planning
Services, implementation will be made through the Investment Management Services described below.
Investment Consulting
We also provide advisory services in the form of oral and written investment consulting services. Similar
to our Investment Management Services, we review and analyze investment holdings in light of the
specific type of account, but we will not be involved
with implementing any recommendations. Clients
receiving this service must understand that the Firm may or may not provide on-going reviews of
accounts through this service and information about such accounts is limited to information provided
exclusively by the client. Clients always have the sole discretion to accept or reject the Firm’s
advice. The client must implement all trades in such accounts because the Firm will not have discretion
over such account.
Investment consulting services may cover, but are not limited to, the following topics: portfolio analysis,
asset allocation strategies, and specific investment recommendations. The Firm provides consulting
services on accounts and other investment holdings owned by the client but not included under the
Firm’s Investment Management Services. These are accounts for which trading authorization is not
granted to the Firm. Examples include a client’s 401(k) or other retirement account, 529 college
planning account, and other accounts held “away” from the Firm’s platform. Clients must understand
that the Firm does not provide on-going reviews of such accounts, and information about such accounts
is limited to information provided exclusively by the client. When Deerfield Financial Advisors provides
consulting advice on accounts and investments, the client will have the sole discretion to accept or
reject the Firm’s advice. The client must implement all trades in such accounts because the Firm will
not have discretion over such account.
Clients are free to implement any or all of the recommendations made by Deerfield Financial Advisors
with another financial institution and are not obligated in any manner to implement the advice of
Deerfield Financial Advisors through the Firm.
See Item 5 of this Brochure for fee descriptions.
Investment Monitoring
We also provide advisory services in the form of oral and written investment monitoring services. These
investment monitoring services are limited aspects of our Investment Management Services. Clients
receiving this service must understand that the Firm may or may not provide on-going reviews of
accounts through this service and information about such accounts is limited to information provided
exclusively by the client. Clients always have the sole discretion to accept or reject the Firm’s
advice. The client must implement all trades in such accounts because the Firm will not have discretion
over the account(s).
Deerfield Financial Advisors provides investment monitoring services in the form of oral commentary
and written reporting. Investment monitoring services cover the following topics: account
reconciliation, performance calculation, portfolio reporting, asset allocation statement, cost basis
tracking, and year-end tax reporting. The Firm may provide investment monitoring on accounts and
other investment holdings owned by the client but not included under the Firm’s investment
management services. These are accounts for which trading authorization is not granted to the
Firm. Examples include a client’s 401(k) or other retirement account or other accounts held “away”
from the Firm’s platform. Clients must understand that the Firm does not provide on-going reviews of
such accounts, and information about such accounts is limited to information provided by the client, the
custodian, and/or electronic data feeds for account transactions. When Deerfield Financial Advisors
provides consulting advice on accounts and investments, the client will have the sole discretion to
accept or reject the Firm’s advice. The client must implement all trades in such accounts because the
Firm will not have discretion over such accounts.
Clients are free to implement any or all of the recommendations made by Deerfield Financial Advisors
with another financial institution and are not obligated in any manner to implement the advice of
Deerfield Financial Advisors through the Firm.
Retirement Plan Services
Deerfield Financial Advisors offers retirement plan services to retirement plan sponsors and to individual
participants in retirement plans. The exact suite of services provided to a client will be listed and detailed
in the Qualified Retirement Plan Agreement. For a corporate sponsor of a retirement plan, our retirement
plan services can include, but are not limited to, the following services:
Fiduciary Consulting Services
Deerfield Financial Advisors provides the following Fiduciary Retirement Plan Consulting Services in
the form of Non-Discretionary Investment Advice. Through this service, Deerfield Financial Advisors
will provide clients with general, non-discretionary investment advice regarding asset classes and
investment options, consistent with their Plan’s investment policy statement (if available). We will not
have investment discretion or any authority to add or remove investment options or trade securities of
the Plan. All recommendations of investment options and portfolios will be submitted to the client for
the client’s ultimate approval or rejection. Therefore, it is always the client’s responsibility to accept
investment recommendations of Deerfield Financial Advisors and then physically make changes to the
plan itself.
Deerfield Financial Advisors acknowledges that in performing the Fiduciary Consulting Services listed
above that it is acting as a “fiduciary” as such term is defined under Section 3(21)(A)(ii) of Employee
Retirement Income Security Act of 1974 (“ERISA”) for purposes of providing non-discretionary
investment advice only. Deerfield Financial Advisors will act in a manner consistent with the
requirements of a fiduciary under ERISA if, based upon the facts and circumstances, such services
cause Deerfield Financial Advisors to be a fiduciary as a matter of law. However, in providing the
Fiduciary Consulting Services, Deerfield Financial Advisors (a) has no responsibility and will not (i)
exercise any discretionary authority or discretionary control respecting management of Client’s
retirement plan, (ii) exercise any authority or control respecting management or disposition of assets
of Client’s retirement plan, or (iii) have any discretionary authority or discretionary responsibility in the
administration of Client’s retirement plan or the interpretation of Client’s retirement plan documents, (b)
is not an “investment manager” as defined in Section 3(38) of ERISA and does not have the power to
manage, acquire or dispose of any plan assets, and (c) is not the “Administrator” of Client’s retirement
plan as defined in ERISA.
Fiduciary Management Services
Deerfield Financial Advisors provides clients with the Fiduciary Retirement Plan Management Services
through our Discretionary Management Services. Through this service, we will provide clients with
continuous and ongoing supervision over the designated retirement plan assets consistent with the
plan’s investment policy statement (if available). We will actively monitor the designated retirement
plan assets and provide advice regarding buying, selling, reinvesting or holding securities, cash or other
investments of the Plan. We will have discretionary authority to make all decisions to buy, sell or hold
securities, cash or other investments for the designated retirement plan assets at our sole discretion
without first consulting with the client. We will also have the power and authority to carry out these
decisions by giving instructions, on behalf of the client, to brokers and dealers and the qualified
custodian(s) of the Plan.
If a client elects to utilize our Fiduciary Management Services, then Deerfield Financial Advisors will be
acting as an Investment Manager to the Plan, as defined by ERISA section 3(38), with respect to our
Fiduciary Management Services, and Deerfield Financial Advisors hereby acknowledges that it is a
fiduciary with respect to its Fiduciary Management Services.
Non-Fiduciary Consulting Services
Deerfield Financial Advisors provides clients with the following Non-Fiduciary Retirement Plan
Consulting Services:
• Participant Education. Deerfield Financial Advisors will provide education services to
Plan participants about general investment principles and the investment alternatives
available under the Plan. Deerfield Financial Advisors’ assistance in participant
investment education will be consistent with and within the scope of DOL Interpretive
Bulletin 96-1. Education presentations will not take into account the individual
circumstances of each participant and individual recommendations will not be provided
unless otherwise agreed upon. Plan participants are responsible for implementing
transactions in their own accounts.
• Participant Enrollment. Deerfield Financial Advisors will assist clients with group
enrollment meetings designed to increase retirement plan participation among
employees and investment and financial understanding by the employees.
Although an investment adviser is considered a fiduciary under the Investment Advisers Act of 1940
and required to meet the fiduciary duties as defined by the Advisers Act, the services listed here as
non-fiduciary should not be considered fiduciary services for the purposes of ERISA since Advisor is
not acting as a fiduciary to the Plan as the term “fiduciary” is defined in Section 3(21)(A)(ii) of ERISA.
Deerfield Financial Advisors does not serve as administrator or trustee of the plan. Deerfield Financial
Advisors will disclose, to the extent required by ERISA Regulation Section 2550.408b-2(c), to clients any
change to the information that we are required to disclose under ERISA Regulation Section 2550.408b-
2(c)(1)(iv) as soon as practicable, but no later than sixty (60) days from the date on which we are informed
of the change (unless such disclosure is precluded due to extraordinary circumstances beyond our control,
in which case the information will be disclosed as soon as practicable).
In accordance with ERISA Regulation Section 2550.408b-2(c)(vi)(A), we will disclose within thirty (30) days
following receipt of a written request from the responsible plan fiduciary or Plan Administrator (unless such
disclosure is precluded due to extraordinary circumstances beyond our control, in which case the
information will be disclosed as soon as practicable) all information related to the Qualified Retirement Plan
Agreement and any compensation or fees received in connection with the Agreement that is required for
the Plan to comply with the reporting and disclosure requirements of Title 1 of ERISA and the regulations,
forms and schedules issued thereunder.
If we make an unintentional error or omission in disclosing the information required under ERISA Regulation
Section 2550.408b-2(c)(1)(iv) or (vi), we will disclose to the client the correct information as soon as
practicable, but no later than thirty (30) days from the date on which we learn of such error or omission.
Limits Advice to Certain Types of Investments
We only provide investment advice on the following types of investments.
• Exchange-listed securities (i.e., stocks)
• Securities traded over-the-counter (i.e., stocks)
• Corporate debt securities (other than commercial paper)
• Commercial paper
• Certificates of deposit
• Municipal securities
• Variable life insurance
• Variable annuities
• Mutual fund shares (primarily no-load mutual funds and funds traded at Net-Asset Value)
• Exchange Traded Funds (ETFs)
• United States government securities
• Options contracts on securities
• Interests in partnerships investing in real estate, oil and gas interests
Deerfield Financial Advisors is available to provide advice on and consult with clients on private placement
securities (which include, but are not limited to, debt, equity, real estate, and/or pooled investment vehicles)
when consistent with the client’s investment objectives and appropriate for the client based on his or her
unique financial situation. If a client decides to invest in a private placement security, the client will need to
complete a subscription agreement showing he or she is an “accredited” investor (as defined by applicable
law, rules and regulations) and acknowledge he or she has read and understands the private placement
memorandum and is aware of the various risk factors of such an investment. When Deerfield Financial
Advisors recommends that a client invests in private placement securities, it is important to know that
Deerfield Financial Advisors does not receive compensation in the form of commissions, finder’s fees or
other economic payments from the sponsors of private placement offerings. Moreover, we do not include
the value of a client’s investment(s) in private placement securities when calculating our percentage-based
assets under management fee. Instead, our time and analysis of private placement securities is covered
by the fixed fee component of our wealth management services.
When managing accounts through our Investment Management Services program we primarily allocate
client assets among mutual funds, ETFs and/or individual debt securities in accordance with the investment
objectives of the client.
(Please refer to Item 8 – Methods of Analysis, Investment Strategies and Risk of Loss for more information.)
Tailor Advisory Services to Individual Needs of Clients
Our services are always provided based on the individual needs of each client. This means, for example,
that we discuss the individual issues involved in transitioning current holdings into Deerfield’s Investment
Management Services program and determine if we need to accommodate any nuances to make this
happen in a tax efficient manner. Deerfield Financial Advisors works with each client on a one-on-one basis
through interviews and questionnaires to determine the client’s investment objectives and suitability
information.
When managing client accounts through the Firm’s Investment Management Services program, we
manage accounts in accordance with multiple investment models that are developed and monitored by our
investment team. Through the management of the models, each client’s portfolio is managed based on the
underlying model to which it is assigned. The determination to use a particular model or models is always
based on each client’s individual investment goals, objectives and mandates.
(Please refer to Item 8 – Methods of Analysis, Investment Strategies and Risk of Loss for more information.)
Client Assets Managed by Deerfield Financial Advisors
The amount of client’s assets managed by Deerfield Financial Advisors totaled $831,472,258 as of
December 31, 2023. $699,252,594 is managed on a discretionary basis and $132,219,664 is managed
on a non-discretionary basis.