Item 5 – Fees and Compensation
In addition to the information provided in Item 4 – Advisory Business, this section provides additional
details regarding our firm’s services along with descriptions of each service’s fees and compensation
arrangements. It should be noted that lower fees for comparable service may be available from other
sources. The exact fees and other terms will be outlined in the agreement between you and Bluerock
Wealth Management.
Asset Management Services
Fees charged for our asset management services are charged based on a percentage of assets under
management, billed in advance (at the start of the billing period) on a quarterly calendar basis and
calculated based on the fair market value of your account as of the last business day of the previous billing
period. Fees are prorated (based on the number of days service is provided during the initial billing period)
for your account opened at any time other than the beginning of the billing period. If asset management
services are commenced in the middle of a billing period, the prorated fee for the initial billing period is
billed in arrears at the same time as the next full billing period’s fee is billed.
The asset management services continue in effect until terminated by either party (i.e., Bluerock Wealth
Management or you) by providing written notice of termination to the other party. Any prepaid, unearned
fees will be promptly refunded by Bluerock Wealth Management to you. Fee refunds will be determined on
a pro rata basis using the number of days services are actually provided during the final period.
Fees charged for our asset management services are negotiable based on the type of client, the
complexity of the client's situation, the potential for additional account deposits, the relationship of the
client with the investment adviser representative, and the total amount of assets under management for
the client.
For our asset management services, clients will be charged an annual fee based upon the amount of
assets under management. Each asset tier shall be assessed a fee percentage in accordance with the
schedule shown below. The cumulative fee percentage for the account shall be a blended rate based on
the fee percentages applied to each asset tier:
Assets Under Management Annual Fees
The first $2,000,000 1.000%
$2,000,001 – $5,000,000 0.750%
Over $5,000,000 0.500%
(This is a blended fee schedule. This means that the assets in a client’s account will be billed at
different levels according to the fee schedule above. For example, if a client had an account value
of $6,000,000 then the following equation would be used to calculate their quarterly fee:
($2,000,000 x1%) + ($3,000,000 x .75%) + ($1,000,000 x .50%) = $47,500/4 = $11,875.00.)
Bluerock Wealth Management has a minimum annual fee of $5,000.
Bluerock Wealth Management believes that its annual fee is reasonable in relation to: (1) services
provided and (2) the fees charged by other investment advisers offering similar services/programs.
However, our annual investment advisory fee may be higher than that charged by other investment
Bluerock Wealth Management, LLC Page 7 Form ADV Part 2A Firm Brochure
advisers offering similar services/programs. In addition to our compensation, you may also incur charges
imposed at the mutual fund level (e.g., advisory fees and other fund expenses).
The investment advisory fees will be deducted from your account and paid directly to our firm by the qualified
custodian(s) of your account. You will authorize the qualified custodian(s) of your account to deduct fees
from your account and pay such fees directly to our firm.
For accounts with a margin balance, clients are assessed the management fee based on the gross value
of the assets in the account. In other words, the account value on which the fee is calculated is not reduced
by the margin balance
You should review your account statements received from the qualified custodian(s) and verify that
appropriate investment advisory fees are being deducted. The qualified custodian(s) will not verify the
accuracy of the investment advisory fees deducted.
Brokerage expenses and/or transaction fees charged by the qualified custodian are billed directly to you
by the qualified custodian. Bluerock Wealth Management does not receive any portion of such
commissions or fees from you or the qualified custodian. In addition, you will incur certain charges
imposed by third parties other than Bluerock Wealth Management in connection with investments made
through your account including, but not limited to, mutual fund sales loads, 12(b)-1 fees and surrender
charges, variable annuity fees and surrender charges, IRA and qualified retirement plan fees, and
charges imposed by the qualified custodian(s) of your account. Management fees charged by Bluerock
Wealth Management are separate and distinct from the fees and expenses charged by investment
company securities that may be recommended to you. A description of these fees and expenses are
available in each investment company security’s prospectus.
On a very limited basis and at the sole discretion of the Advisor asset management services may be
charged in a manner different from the fee schedule referenced above. Asset Management service may
be provided on a fixed percentage of asset management fee or a fixed flat fee basis. The type of asset
management fee to be charged and how the asset management fees will be billed will be specified in
your client agreement.
Financial Planning Services
Bluerock Wealth Management does not charge a separate fee for our financial planning services.