FEES AND COMPENSATION (ITEM 5)
Wealth Management Service
Clients who choose our Wealth Management Service, whether to implement their
Financial Landscape Analysis or separately, pay fees based on an annual percentage of
assets under management as valued by our third-party portfolio accounting system
provider at the close of market on the last business day of each quarter. The initial
Wealth Management fee is charged when the Investment Policy Statement is presented
to the client. Fees are charged in advance, are generally deducted directly from a
client’s account only with the client’s written permission as stated in Investment
Management Agreement and are charged at the rate of one quarter (1/4) of the amount
shown below each quarter. (On occasion, a client does not want fees deducted from the
account, so they pay us by check or credit card.) This fee includes financial planning
services we make available to investment management clients on an ongoing basis.
Part 2A of Form ADV: Firm Brochure
Stone Wealth Management
March 2023
Assets under Management Annual Fee
First $1,000,000 1.00% plus
$1,000,001 to $2,000,000 0.80% plus
$2,000.001 to $3,000,000 0.60% plus
Over $3,000,000 0.50%
We generally require a minimum annual fee of $5,000 to open a Wealth Management
account, which translates to a minimum account size of $500,000. This minimum is
waived in certain circumstances. For example, in order to accommodate an account of
an existing client’s children who are minors. Because the minimum annual fee could
result in fees being over 3% if the account(s) fall(s) below $134,000, similar services
may be found elsewhere for a lower fee.
Our fees are negotiable, and because we have a long history with many of our clients,
fee schedules differ. Some schedules have lower minimums, lower rates on the higher
tier, and some clients pay the same rate across all assets we manage. Therefore, some
clients pay more than others with the same assets under management. However, no
clients pay more than the above schedule. We do not differentiate our service offering to
Wealth Management clients based on their fee schedule. Under pre-approved
circumstances, we will group some accounts we manage for persons under the same
household in order to attain a lower overall fee.
These Wealth Management fees are separate from transaction, exchange, wire transfer,
margin interest or account fees charged by the custodian(s). To the extent that client
assets are invested in money market or mutual funds, our fees for monitoring those
assets are in addition to the fees included in the internal expenses of those funds paid to
their own investment managers, which are fully disclosed in each fund’s prospectus,
which is provided by the account custodian. Some custodians charge transaction fees
on some mutual funds, so that clients are paying more to purchase or sell these funds
than if we went directly to these fund families on behalf of clients.
Financial Landscape Analysis
We charge $2500 to complete a client’s Financial Landscape Analysis. This fee is paid
by check or credit card upon executing a Financial Landscape Analysis Agreement. This
fee is credited toward a client’s wealth management fee if a client chooses to engage us
for our Wealth Management Service within 90 days of delivery of the Financial
Landscape Analysis. There is no obligation for the client to engage us to implement the
recommendations of the analysis. The analysis is normally delivered to the client within
6 months of execution of the Agreement.
Use of Experts
On rare occasions, we engage experts to assist with analysis of particular investments.
These engagements will be made only with a client’s prior permission. We will notify the
client in advance if expert fees will be charged to the client.
Part 2A of Form ADV: Firm Brochure
Stone Wealth Management
March 2023
Termination
Both the Wealth Management and Financial Landscape Analysis Agreements allow for
termination by either party immediately upon receipt of written notice. Any prepaid
unearned Wealth Management fees will be promptly returned to the client upon receipt
of written termination notice, removal of us as an authorized party or by transferring
managed accounts elsewhere. If a client terminates a Financial Landscape Analysis
Agreement before the analysis has been completed and presented, we will return any
unearned funds based on the percentage of work completed. Each Agreement provides
parameters for a client to terminate the Agreement within five business days of its
effective date without paying any fees or penalties.
PERFORMANCE-BASED FEES AND SIDE-BY-SIDE MANAGEMENT (ITEM 6)
We do not receive performance-based fees so this does not apply.