Item 5: Fees & Compensation
Below we describe fees and expenses so clients will know exactly how much we charge for the advisory services provided.
Fees are typically not negotiable; however, we reserve the right to discount advisory fees based on the scope and complexity
(or lack thereof) of the engagement. Because our firm’s primary focus is the discovery, design, and review of the financial
plan, we charge our fees based on the total asset value of investment assets under our advisement. This excludes personal
assets like primary residence, vehicles, other personal property, and illiquid assets. For calculation purposes we round to
the nearest dollar.
Kahler Financial Group Financial Planning Charge Matrix
Asset under Management and Advisement Tiered Range Annual Percentage
$0 to $780,000 1.30%
$780,000.01 to $1,825,000 1.00%
$1,825,000.01 to $3,675,000 0.80%
$3,675,000.01 to $8,000,000 0.55%
$8,000,000.01 to $18,000,000 0.50%
Over $18,000,000 Negotiable
Kahler Financial Group Fee Structure (Investment Only)
Asset under Management Tiered Range Annual Percentage
$0 to $1,825,000 1.00%
$1,825,000.01 to $3,675,000 0.75%
$3,675,000 .01 to $8,000,000 0.50%
$8,000,000.01 to $18,000,000 0.30%
Over $18,000,000 Negotiable
Financial planning fees are established annually based on the assets under advisement which includes asset managed under
KFG (including cash and cash equivalents) as of October 31st of the previous year. We have a one-time data-gathering and
design fee of up to 50% of the annual financial planning fee. Financial Planning clients have a minimum quarterly fee of
$1,875 and for their assets in managed accounts held at Schwab there is an additional 0.04% charged quarterly to partially
cover third-party manager fees. The one-time data-gathering and design fee, and the first quarterly fee are due at the
beginning of the engagement. Thereafter, financial planning fees are due quarterly in arrears. Investment Only advisory
fees are based on account balances (including cash and cash equivalents) on October 31st of each year and charged quarterly
in arrears during the following year. We do not make adjustments for deposits and withdrawals in fee calculations.
For the sub-advisory services rendered to our clients, our firm compensates third party investment advisory firms or
individual advisors a percentage of the overall investment advisory fee charged by our firm. The advisory fee paid shall not
exceed the fee published for this service.
We rebalance portfolios held at Schwab at least annually. We offer rebalance recommendation for employer-controlled
retirement portfolios held away from Schwab annually. We need timely information on assets held away from Schwab.
Assets, on which the client does not provide Kahler Financial Group with automatic and timely updated statements, will not
be included in any asset allocations, financial statements, or reports. This significantly slows down our internal process and
the quality of advice received from us.
Because we calculate our annual financial planning fee on a percentage of investment assets, there exists a potential conflict
of interest regarding advice given by us since our revenues are directly impacted by the size of the client portfolio. There is
also a potential conflict of interest if a client decides to convert investment assets, on which we charge a fee, to tangible
assets like real estate, closely held businesses, permanent life insurance, and other personal assets, on which we don’t
charge a fee.
Other services not listed above will be billed on an hourly basis. A project fee may be quoted based upon the time and effort
required. The total fee and services to be provided are agreed upon at the time of engagement. Project fees will vary based
upon the amount of time we incur for the project, in addition to the nature and complexity of services. These may be billed
at a rate of up to $500 per hour.
We will automatically deduct fees from one of the client’s managed accounts unless directed otherwise. As part of this
process, the client understands and acknowledges the following:
a) The independent custodian sends statements at least quarterly to clients showing all disbursements from the
account, including the amount of the financial planning fees paid as well as the asset management fee paid.
b) The client provides authorization permitting us to be directly paid by these terms.
The client will incur transaction charges for trades executed in the accounts. These transaction fees are separate from our
annual financial planning fees. Also, the client will pay the following separately incurred expenses, which we do not receive
any part of: charges imposed directly by a mutual fund, index fund, or exchange traded fund which shall be disclosed in the
fund’s prospectus (i.e., fund management fees and other fund expenses).
Our firm’s annual financial planning fees are billed on a quarterly basis in arrears. Since we are billing in arrears, our invoices
are due and payable when received. If the client wishes to terminate our advisory services, 30 days’ notice in writing is
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