A. FIRM INFORMATION
Wealthcare Capital Management LLC (“WCM” or the “Advisor”) is a registered investment advisor with
the U.S. Securities and Exchange Commission (“SEC”). WCM is a limited liability company (“LLC”)
organized in the State of Delaware and is headquartered in Richmond, Virginia. WCM is a wholly-owned
subsidiary of Wealthcare Parent Holdings LLC (which is principally owned by Financeware LLC and VMS
Intermediate Inc.)WCM is operated by Matthew T. Regan (President), Ronald E. Madey (Chief Investment
Officer), Justin DuBrueler (Chief Financial Officer) and James J. Krause (Chief Compliance Officer). This
Disclosure Brochure provides information regarding the qualifications, business practices, and the advisory
services provided by WCM. For additional information about our ownership structure, please see our Form
ADV Part 1A, Schedules A and B.
WCM offers services through its Advisory Persons. Advisory Persons may have their own legal business
entities whose trade names and logos are used for marketing purposes and may appear on marketing
materials and/or Client statements. The Client should understand that the businesses are legal entities of the
Advisory Person and not of WCM. The Advisory Persons are under the supervision of WCM, and the
advisory services of Advisory Persons are provided through WCM. Advisory Persons provide services and
charge fees based in accordance with the descriptions detailed in this Disclosure Brochure and the terms of
the Client agreement. However, the exact service and fees charged to the Client are dependent upon the
Advisory Person that is working with the Client. Advisory Persons are appropriately licensed and
authorized to provide advisory services on behalf of WCM.
B. ADVISORY SERVICES OFFERED
WCM provides investment advisory, portfolio management and related services to individuals, high net
worth individuals, trusts, estates, retirement plans, business entities, including other investment advisors,
charitable institutions, endowments and foundations (each hereinafter a “Client” or collectively as
“Clients”).
The Advisor serves as a fiduciary to Clients, as defined under the applicable laws and regulations. As a
fiduciary, the Advisor upholds a duty of loyalty, fairness and good faith towards each Client and seeks to
mitigate potential conflicts of interest. WCM’s fiduciary commitment is further described in the Advisor’s
Code of Ethics. For more information regarding the Code of Ethics, please see Item 11 – Code of Ethics,
Participation or Interest in Client Transactions and Personal Trading.
Wealth Management Services
WCM provides tailored investment advisory solutions to its Clients. This is achieved through personal
Client contact and interaction while providing discretionary or non-discretionary investment management
over Client portfolios and a broad range of comprehensive financial planning. Investment Management and
Financial Planning services are also offered as standalone services. These services are described below.
Investment Management Services
WCM provides customized investment advisory solutions for its Clients. This is achieved through
continuous personal Client contact and interaction while providing discretionary and/or non-discretionary
investment management and related advisory services. WCM works with each Client to identify their
investment goals and objectives as well as risk tolerance and financial situation in order to create an
investment strategy. WCM will then design a portfolio utilizing the Advisor’s internal investment strategies,
alternative investments, or independent managers as described below.
WCM will place Client assets into one of WCM’s models consisting of mutual funds, ETFs and/or
alternative investments. WCM also believes that certain Clients may benefit from individual stock and fixed
Wealthcare Capital Management LLC – Disclosure Brochure – March 25, 2024 Page 5
income portfolio management services and strategies. These strategies would assist Clients in meeting their
market exposure, risk management, tax management and return objectives in a cost-effective manner using
systematic strategies. WCM will collaborate with independent manager and Clients to design and
implement customized solutions to accommodate personal preferences including sector/industry constraints
as well as ESG (environmental, social and governance) preferences as well as establishment of additional
investment guidelines as they deem necessary.
In certain instances, the Advisor will allow for certain substitute securities in its model portfolios. Most
typically, these allowances are made for securities that are transferred “in-kind” into a Client’s account and
are held at the client’s direction, due to adverse tax consequences to sell and/or due to fund line-up
limitations.
Mutual Funds – WCM seeks to select mutual fund share classes on a fund-by-fund basis and seeks to select
the most appropriate share class for its model portfolios and clients. Generally, and subject to availability,
WCM will select the share class with the lowest expense ratio, which means that clients will typically pay
transaction fees, but the fund does not have any associated service fees or Rule 12b-1 fees. However, WCM,
in certain instances, may select a share class with a higher expense ratio where it believes that this share
class is most appropriate. WCM is under no obligation to request waivers of investment minimums
contained in prospectuses for mutual funds, but may determine to do so. In addition, due to specific
custodial, account or mutual fund company constraints, there may be situations where a specific share class
is not consistently available and all or some clients may be invested in a replacement share class that WCM
determines is appropriate.
Exchange Traded Funds – Similarly, WCM selects ETFs on a fund-by-fund basis. Key decision criteria
include targeted asset class exposure, expense ratios, track record, ticket charges at the respective
custodians, assets under management and liquidity analysis.
Alternative Investments – As noted above, certain models may include the use of alternative investments
when deemed appropriate and in the Client’s best interest. Investing directly in hedge funds, private equity,
and/or real estate funds can be difficult for many individuals given due diligence requirements, portfolio
construction complexity, large minimum investments which limit an individual’s ability to diversify his/her
investments, restrictive liquidity terms, and other access limitations. To help offset these potential barriers
to entry into these types of investment opportunities, WCM engages with alternative investment platforms
to: (i) provide due diligence resources and services; (ii) facilitate access to managers at lower minimums;
and (iii) structure multi-manager private investment solutions that allow WCM qualified clients to access
relatively diversified and carefully constructed pools of institutional-quality alternative investments,
including hedge funds and private equity and real asset funds, managed by unaffiliated investment advisers.
WCM structures these opportunities by leveraging third-party platform resources (investment research, risk
management, legal and operational due diligence) to supplement its in-house resources.
Through these third-party platforms, WCM can offer single strategy and multi-strategy investments in a
private fund construct, a private fund-of-funds construct, or a custom private multi-strategy portfolio (e.g..:
arbitrage; credit; equity long/short; global macro; event driven; private equity; and real estate) using private
limited liability companies or limited partnerships that are exempt from registration under federal securities
regulations, including the Investment Company Act of 1940 (the “Investment Company Act”) and the
Securities Act of 1933 (the “Securities Act”).
Investment in these alternative investments is limited to persons who are “accredited investors” as defined
under the Securities Act and, depending on the fund, “qualified purchasers” as defined in the Investment
Company Act. Clients should refer to the private placement memoranda and class supplement documents,
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as well as the underlying funds’ private placement memoranda, for a more complete discussion of these
investments.
WCM’s investment approach is primarily long-term focused, but the Advisor may buy, sell or re-allocate
positions that
have been held less than one year to meet the objectives of the Client or due to market
conditions. WCM will construct, implement and monitor the portfolio to ensure it meets the goals,
objectives, circumstances, and risk tolerance agreed to by the Client. Each Client will have the opportunity
to place reasonable restrictions on the types of investments to be held in their respective portfolio, subject
to acceptance by the Advisor. WCM evaluates and selects investments for inclusion in Client portfolios
only after applying its internal due diligence process. WCM may recommend, on occasion, redistributing
investment allocations to diversify the portfolio. WCM may recommend selling positions for reasons that
include, but are not limited to, harvesting capital gains or losses, overweighting of the position[s] in the
portfolio, change in risk tolerance of Client, generating cash to meet Client needs, or any risk deemed
unacceptable for the Client’s risk tolerance.
At no time will WCM accept or maintain custody of a Client’s funds or securities, except for the limited
authority as outlined in Item 15 – Custody. All Client assets will be managed within their designated
account[s] at the Custodian, pursuant to the terms of the investment advisory agreement. For additional
information, please see Item 12 – Brokerage Practices.
Use of Independent Managers – WCM believes that certain Clients may benefit from individual stock and
fixed income portfolio management services and strategies. These strategies would assist Clients in meeting
their market exposure, risk management, tax management and return objectives in a cost-effective manner
using systematic strategies. In such instances, WCM will recommend that Clients utilize one or more
unaffiliated investment managers or investment platforms (collectively “Independent Managers”) for all or
a portion of a Client’s investment portfolio, based on the Client’s needs and objectives. The Client may be
required to authorize and enter into an investment management agreement with the Independent Manager[s]
that defines the terms in which the Independent Manager[s] will provide its services. The Advisor will
perform initial and ongoing oversight and due diligence over each Independent Manager to ensure the
strategy remains aligned with Clients’ investment objectives and overall best interests. The Advisor will
also assist the Client in the development of the initial policy recommendations and managing the ongoing
Client relationship. The Client, prior to entering into an agreement with an Independent Manager, will be
provided with the Independent Manager's Form ADV Part 2A - Disclosure Brochure (or a brochure that
makes the appropriate disclosures).
Investment Strategist / Model Management Services - WCM also serves financial intermediaries (the
“Intermediary[ies]”) and their end clients (the “End Client[s]”), whereby WCM provides investment models
through a contractual engagement with the Intermediary[ies]. The Intermediary[ies] establishes and
maintains the relationship with its End Clients and retains the sole responsibility for suitability and overall
management of the End Client relationship. WCM will not establish a contractual relationship directly with
the End Client[s], but may accept, at its sole discretion, restrictions placed on its investment strategist
services by the Intermediary[ies]. WCM’s investment strategist services may include strategic asset
allocation models, tactical asset allocation models, absolute-return oriented models as well a multi-
manager, multi-product and/or multi-strategy models for individual asset classes and/or for the total
portfolio asset allocation.
Investment models may be customized and offered for use in accounts with varying tax treatment, account
size and complexity. WCM will have the authority to make recommendations and manage the investment
models, which each Intermediary, shall act upon in their sole discretion with respect to each End Client
account pursuant to an advisory agreement between the End Client and the Intermediary.
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Retirement Plan Advisory Services
WCM provides advisory services to retirement plans (each a “Plan”) and the company sponsor (the “Plan
Sponsor”). The Advisor’s retirement plan advisory services are designed to assist the Plan Sponsor in
meeting its fiduciary obligations to the Plan. Each engagement is customized to the needs of the Plan and
Plan Sponsor. Services may include:
● Development and Monitoring of an Investment Policy Statement (“IPS”) for the Plan Sponsor.
● Discretionary selection or non-discretionary recommendations of Plan Participant investment
options and design of efficient portfolios (WCM 401(k) portfolios) across the risk/return spectrum.
● A phone-in service to answer Plan Participant questions about Plan investment options and related
plan information including the offer to any Plan Participant to create a personalized Wealthcare
Plan and, if approved by the Plan Participant, to periodically track and report on the status of the
Plan and revise it as requested by the Plan Participant or to make new Plan recommendations for
the Plan Participant to consider. For some Plan Sponsors, in-person Plan Participant retirement
investment planning educational meetings may be provided.
● Design and delivery of a self-scoring risk tolerance and time horizon questionnaire for use by Plan
Participants mapped to the WCM 401(k) portfolio selections for optional use by Plan Participants.
● Periodic rebalancing when appropriate of any WCM 401k Portfolios selected as investment options
by Plan Participants.
Certain of these services are provided by WCM serving in the capacity as a fiduciary under the Employee
Retirement Income Security Act of 1974, as amended (“ERISA”). In accordance with ERISA Section
408(b)(2), the Plan Sponsor is provided with a written description of WCM’s fiduciary status, the specific
services to be rendered and all direct and indirect compensation the Advisor reasonably expects under the
engagement. Additionally, plan participants may choose to engage the Advisor for individual investment
management services, as described above.
Currently, WCM works with Employee Fiduciary Corporation of Mobile, Alabama as the preferred
provider of third-party administrative and related services to 401(k) Plans and Plan Participants. WCM is
not financially affiliated with Employee Fiduciary Corporation. WCM does not receive any fees from
Employee Fiduciary.
C. CLIENT ACCOUNT MANAGEMENT
Prior to engaging WCM to provide investment advisory services, each Client is required to enter into one
or more agreements with the Advisor that define the terms, conditions, authority and responsibilities of the
Advisor and the Client. These services may include:
§ Establishing an Investment Strategy – WCM, in connection with the Client, will develop a strategy
that seeks to achieve the Client’s goals and objectives.
§ Asset Allocation – WCM will develop a strategic asset allocation that is targeted to meet the
investment objectives, time horizon, financial situation and tolerance for risk for each Client.
§ Portfolio Construction – WCM will develop a portfolio for the Client that is intended to meet the
stated goals and objectives of the Client.
§ Investment Management and Supervision – WCM will provide investment management and
ongoing oversight of the Client’s investment portfolio.
D. WRAP FEE PROGRAM
WCM does not sponsor a wrap fee program in connection with their investment management services.
However, WCM may serve as portfolio manager to a third-party advisor’s (“TPA’s”) wrap fee program. A
TPA’s wrap fee program is inclusive of trade commissions, other custody costs and both WCM’s advisory
fee and the Program Sponsor’s advisory fee.
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A complete description of these programs and related fees, charges, when due and termination procedures
are described in the respective TPAs disclosure brochures, which Clients receive at or prior to the
engagement with the TPA.
E. ASSETS UNDER MANAGEMENT
As of December 31, 2023, WCM manages $2,579,940,831 in Client assets, $2,539,043,842 of which is on
a discretionary basis and $40,896,989 on a non-discretionary basis. Clients may request more current
information at any time by contacting the Advisor.