Firm Description
Alpha Financial Advisors, LLC (“Alpha Financial”), founded in 2002, is a SEC-
registered investment adviser headquartered in Charlotte, North Carolina.
Alpha Financial provides personalized, confidential financial planning and
investment management to individuals, families, trusts, estates, and small
businesses. Advice is provided through consultation with the client and may
include: determination of financial objectives, identification of financial
problems, cash flow management, tax planning, insurance review, investment
management, education funding, retirement planning, and estate planning.
Investment advice is an integral part of financial planning. In addition, Alpha
Financial advises clients regarding cash flow, college planning, retirement
planning, tax planning and estate planning.
Alpha Financial may act as a custodian of client assets under certain
circumstances outlined in Item 15. However, the client typically maintains asset
control. Alpha Financial places trades for clients under a limited power of
attorney. Assets under the direct management of Alpha Financial are held
directly by independent custodian including Charles Schwab and Company
(”Schwab”), Nationwide Advisory Solutions, my529 Plan and American Funds
CollegeAmerica, in the client’s name.
The goals and objectives for each client are documented in our client
relationship management system. A written evaluation of each client's initial
situation is provided to the client, often in the form of an Investment Objective
Letter. Clients can impose reasonable restrictions on investing in certain
securities or types of securities.
We may recommend other professionals (e.g., lawyers, accountants, insurance
agents, real estate agents, etc.) at the request of the client. Other professionals
are engaged directly by the client on an as-needed basis even when
recommended by Alpha Financial. Conflicts of interest will be disclosed to the
client in the unlikely event they should occur and managed in the best interests
of the client.
The initial meeting, which may be by telephone, is free of charge and is
considered an exploratory interview to determine the extent to which financial
planning and investment management may be beneficial to the client.
Principal Owners
ANN REILLEY is Alpha Financial’s Managing Member, Chief Compliance
Officer, and 95% principal owner.
H. NICK BARRINGER, is a 5% Member owner.
Types of Advisory Services
Alpha Financial provides ongoing investment advisory and financial planning
services. Advice is furnished to clients on financial planning matters not
involving securities, such as taxation issues, insurance and estate planning
services.
In performing its services, Alpha Financial is not required to verify any
information received from the client or from the client’s other professionals.
Each client is advised that it remains his/her responsibility to promptly notify
Alpha Financial when there is any change in his/her financial situation and/or
financial objectives for the purpose of reviewing, evaluating, or revising
previous recommendations and/or services.
As of December 31, 2023, Alpha Financial actively managed approximately
$444 million of clients’ assets across 250 households primarily on a
discretionary basis.
Financial Planning and Investment Advisory Services
Financial Planning and Investment Advisory Services may include, but are not
limited to: ongoing discretionary investment management based on an agreed-
upon investment objective and asset allocation; a net worth statement; a cash
flow statement; strategic tax planning; a review of retirement plans including
recommendations; a review of insurance policies and recommendations for
changes; retirement planning scenarios; estate planning review and
recommendations; and education planning with funding recommendations.
Alpha Financial manages client investment assets on a discretionary basis in
order to integrate the financial plan and to provide ongoing in-depth advice.
The financial plan is based on realistic and measurable goals, which are set
along with objectives to reach the goals as defined. As goals and objectives
change over time, recommendations are made and implemented on an
ongoing basis.
Assets are invested primarily in no-load mutual funds and exchange-traded
funds, usually through discount brokers or fund companies. Fund companies
charge each fund shareholder an investment management fee that is disclosed
in the fund prospectus. Discount brokerages may charge a transaction fee for
the purchase of some funds.
The scope of work and fee for Investment Advisory Services is provided to the
client in writing in the form of an Investment Advisory Agreement prior to the
start of the relationship.
Although Financial Planning and Investment Advisory Services are an ongoing
agreement and constant adjustments are required, the length of service to the
client is at the client’s discretion. The client or Alpha Financial may terminate
an Agreement by written notice to the other party. At termination, fees will be
billed on a pro rata basis for the portion of the quarter completed. The portfolio
value at the completion of the prior full billing quarter is used as the basis for
the fee computation, adjusted for the number of days the investments were
managed during the billing quarter prior to termination.
Termination of Agreement
Either the Client or Alpha Financial can terminate the engagement at any time
by notifying the other party, in writing. As indicated above, upon termination,
Alpha’s Financial’s earned but unpaid fees will be billed on a pro rata basis for
the portion of the quarter that services were provided prior to termination.
Miscellaneous
Limitations of Financial Planning and Non-Investment Consulting/
Implementation Services. To the extent requested by the client, Alpha
Financial will generally provide financial planning and related consulting
services regarding matters such as tax and estate planning, insurance, etc.
Alpha Financial will generally provide such consulting services inclusive of its
advisory fee set forth at Item 5 below (exceptions could occur based upon
assets under management, extraordinary matters, special projects, stand-
alone planning engagements, etc. for which Firm may charge a separate or
additional fee). Please Note. Alpha Financial believes that it is important for
the client to address financial planning issues on an ongoing basis. Alpha
Financial’s advisory fee, as set forth at Item 5 below, will remain the same
regardless of whether or not the client determines to address financial planning
issues with Alpha Financial. Please Also Note: Alpha Financial does not
serve as an attorney, accountant, or insurance agent, and no portion of our
services should be construed as same. Accordingly, Alpha Financial does not
prepare legal documents, prepare tax returns, or sell insurance products. To
the extent requested by a client, we may recommend the services of other
professionals for non-investment implementation purpose (i.e., attorneys,
accountants, insurance, etc.). The client is not under any obligation to engage
any such professional(s). The client retains absolute discretion over all such
implementation decisions and is free to accept or reject any recommendation
from Alpha Financial and/or its representatives. If the client engages any
professional (i.e., attorney, accountant, insurance agent, etc.), 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] (i.e. attorney, accountant,
insurance agent, etc.), and not Alpha Financial, shall be responsible for the
quality and competency of the services provided.
Please Note: Retirement Rollovers-Potential for 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 Alpha Financial
recommends that a client roll over their retirement plan assets into an account
to be managed by Alpha Financial, such a recommendation creates a conflict
of interest if Alpha Financial will earn new (or increase its current)
compensation as a result of the rollover. If Alpha Financial 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), Alpha Financial 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 Alpha
Financial, whether it is from an employer’s plan or an existing IRA. Alpha
Financial’s Chief Compliance Officer, Ann Reilley, 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.
Allocation to Mutual Funds and Exchange Traded Funds: Many mutual
funds and exchange traded funds are available directly to the public. Therefore,
a
prospective client can obtain many of the funds that may be utilized by Alpha
Financial independent of engaging Alpha Financial as an investment adviser.
However, if a prospective client determines to do so, he/she will not receive the
Alpha Financial’s initial and ongoing investment advisory services. Please
Note-Use of DFA Mutual Funds: Alpha Financial utilizes some mutual funds
issued by Dimensional Fund Advisors (“DFA”) in client portfolios. DFA funds
are generally only available through registered investment advisors. Thus, if a
client terminates Alpha Financial’s services, and does not transition to another
adviser who utilizes DFA mutual funds, restrictions regarding additional
purchases of, or reallocation among other DFA funds will generally apply. In
addition, Alpha Financial representatives may be invited to DFA sponsored
events on a gratis or discounted basis-see Item 12. Alpha Financial’s Chief
Compliance Officer, Ann Reilley, remains available to address any
questions that a client or prospective client may have regarding the
above.
Schwab. As discussed below at Item 12 below, when requested to
recommend a broker-dealer/custodian for client accounts, Alpha Financial
generally recommends that Schwab serve as the broker-dealer/custodian for
client investment management assets. Broker-dealers such as Schwab charge
brokerage commissions, transaction, and/or other type fees for effecting certain
types of securities transactions (i.e., including transaction fees for certain
mutual funds, and mark-ups and mark-downs charged for fixed income
transactions, etc.). The types of securities for which transaction fees,
commissions, and/or other type fees (as well as the amount of those fees) shall
differ depending upon the broker-dealer/custodian (while certain custodians,
including Schwab do not currently charge fees on individual equity transactions,
others do). These fees/charges are in addition to Alpha Financial’s investment
advisory fee at Item 5 below. Alpha Financial does not receive any portion of
these fees/charges. ANY QUESTIONS: Alpha Financial’s Chief Compliance
Officer, Ann Reilley, remains available to address any questions that a
client or prospective client may have regarding the above.
Portfolio Activity. Alpha Financial has a fiduciary duty to provide services
consistent with the client’s best interest. As part of its investment advisory
services, Alpha Financial 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, market conditions, fund manager
tenure, style drift, regular re-balancing and/or a change in the client’s
investment objective. Based upon these factors, there may be extended
periods of time when Alpha Financial 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.
ERISA PLAN and 401(k) INDIVIDUAL ENGAGEMENTS:
• Trustee Directed Plans. Alpha Financial 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, Alpha Financial will serve as an investment fiduciary as
that term is defined under The Employee Retirement Income Security
Act of 1974 (“ERISA”). Alpha Financial 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.
• Client Retirement Plan Assets. Alpha Financial provides investment
advisory services relative to retirement plan assets including 401(k),
403b and 457 Plans offered by the client’s employer held at Plan
custodian. Alpha Financial allocates (or recommends that the client
allocate) the retirement account assets among the investment options
available on the 401(k) platform. Alpha Financial’s ability shall be limited
to the allocation of the assets among the investment alternatives
available through the plan. Alpha Financial will not receive any
communications directly from the plan sponsor or custodian, and it shall
remain the client’s exclusive obligation to notify Alpha Financial of any
changes in investment alternatives, restrictions, etc. pertaining to the
retirement account. Unless expressly indicated to the client in writing,
Alpha Financial shall includethe client’s retirement plan assetsas assets
under management for purposes of calculating the advisory fee.
Please Note: Non-Discretionary Service Limitations. Clients that
determine to engage Alpha Financial on a non-discretionary investment
advisory basis must be willing to accept that Alpha Financial cannot
effect any account transactions without obtaining prior consent to any
such transaction(s) from the client. Thus, in the event that Alpha
Financial would like to make a transaction for a client’s account, and
client is unavailable, Alpha Financial will be unable to effect the account
transaction (as it would for its discretionary clients) without first obtaining
the client’s consent.
Please Note: Cash Positions. Alpha Financial continues to treat cash
as an asset class. As such, unless determined to the contrary by Alpha
Financial, all cash positions (money markets, etc.) shall continue to be
included as part of assets under management for purposes of
calculating Alpha Financial’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), Alpha Financial may maintain cash
positions for defensive purposes. In addition, while assets are
Commented [CL1]: Is registrant = Alpha Financial here?
Commented [AG2R1]: Reworded thanks for catching this
Commented [CL3]: Same ? As above
Commented [AG4R3]: Edited
maintained in cash, such amounts could miss market advances.
Depending upon current yields, at any point in time, Alpha Financial’s
advisory fee could exceed the interest paid by the client’s money market
fund. ANY QUESTIONS: Alpha Financial’s Chief Compliance
Officer, Ann Reilley, remains available to address any questions
that a client or prospective may have regarding the above fee
billing practice.
Borrowing Against Assets/Risks. A client who has a need to borrow money
could determine to do so by using:
• Margin-The account custodian or broker-dealer lends money to the client.
The custodian charges the client interest for the right to borrow money, and
uses the assets in the client’s brokerage account as collateral. Alpha does
not recommend the use of margin; and,
• Pledged Assets Loan- In consideration for a lender (i.e., a bank, etc.) to
make a loan to the client, the client pledges its investment assets held at
the account custodian as collateral;
These above-described collateralized loans are generally utilized because they
typically provide more favorable interest rates than standard commercial loans.
These types of collateralized loans can assist with a pending home purchase,
permit the retirement of more expensive debt, or enable borrowing in lieu of
liquidating existing account positions and incurring capital gains taxes.
However, such loans are not without potential material risk to the client’s
investment assets. The lender (i.e., custodian, bank, etc.) will have recourse
against the client’s investment assets in the event of loan default or if the assets
fall below a certain level. For this reason, Alpha Financial does not recommend
such borrowing unless it is for specific short-term purposes (i.e., a bridge loan
to purchase a new residence). Alpha Financial does not recommend such
borrowing for investment purposes (i.e., to invest borrowed funds in the
market). Regardless, if the client was to determine to utilize margin or a pledged
assets loan, the following economic benefits would inure to Alpha Financial:
• by taking the loan rather than liquidating assets in the client’s account,
Alpha Financial continues to earn a fee on such Account assets; and,
• if the client invests any portion of the loan proceeds in an account to be
managed by Alpha Financial, Alpha Financial will receive an advisory fee
on the invested amount; and,
• if Alpha Financial’s advisory fee is based upon the higher margined account
value, Alpha Financial will earn a correspondingly higher advisory fee. This
could provide Alpha Financial with a disincentive to encourage the client to
discontinue the use of margin. Alpha does not recommend the use of
margin.
Please Note: The Client must accept the above risks and potential
corresponding consequences associated with the use of margin or a pledged
assets loan.
Client Obligations. In performing our services, Alpha Financial 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, it
remains each client’s responsibility to promptly notify Alpha Financial if there is
ever any change in his/her/its financial situation or investment objectives for the
purpose of reviewing/evaluating/revising our previous recommendations and/or
services.
Investment Risk. Different types of investments involve varying degrees of risk,
and it should not be assumed that future performance of any specific
investment or investment strategy (including the investments and/or investment
strategies recommended or undertaken by Alpha Financial) will be profitable or
equal any specific performance level(s).