Item 5: Fees and Compensation
Method of Compensation and Fee Schedule
TRAJAN WEALTH provides advisory services on a fee-based model. Clients pay
a fee for ongoing advisory services that is calculated as a percentage of
assets under management (“AUM”). This structure is designed to provide
transparency and align our interests with those of our Clients.
Our standard annual advisory fee generally ranges between 0.50% and 1.50%
of assets under management. In certain circumstances, such as smaller
account sizes or relationships that require additional servicing, the advisory
fee may range between 1.50% and 2.00% annually.
Unlike commission-based arrangements, TRAJAN WEALTH does not charge
commissions for advisory services or investment transactions. Instead, our
compensation is tied to the value of the assets we manage on your behalf. As
a result, our firm benefits when your portfolio grows over time, which helps
align our incentives with your long-term financial success.
Fees are agreed upon between your Fiduciary Advisor and you and are
outlined in your Investment Advisory Agreement (“IAA”).
TRAJAN WEALTH reserves the right to modify its advisory fee schedule in the
future upon providing Clients with at least 30 days’ advance written notice.
Monthly Billing
Advisory fees for most TRAJAN WEALTH client accounts are calculated and
billed monthly in advance, based on the value of the account at the prior
month-end. Fees collected for any partial period will be prorated or rebated
based on the fee calculation outlined in the applicable Investment Advisory
Agreement (“IAA”). The authorization and method of payment will be
documented in the Client’s IAA or other applicable Agreement.
For “typical” Client accounts, the initial billing of advisory fees will be based on
the account activation date. Once the account has reached the
predetermined funding threshold, TRAJAN WEALTH will bill for the period from
the account activation date through the current month-end, and from the
current month-end through the next month-end (in advance). As a result,
Clients may be billed for multiple periods during the first billing cycle.
Thereafter, advisory fees will be billed monthly in advance based on the
account’s prior month-end value.
401GO Account Billing
Retirement plan accounts administered through the 401GO platform are billed
differently from other advisory accounts. For these accounts, advisory fees
are billed in arrears, based on the value of the assets as of the last day of the
billing period.
Advisory fees charged for these accounts are generally below 1% annually.
These retirement plan arrangements are typically established by business
owners and are governed by separate plan agreements and service
arrangements. The specific terms and fees applicable to these accounts will
be discussed with Clients during meetings with their Advisor and documented
in the applicable agreements.
Client Payment of Fees
TRAJAN WEALTH is authorized to deduct advisory fees directly from your
account(s). This billing method is designed to provide a simple and efficient
way to pay for ongoing advisory services without requiring Clients to submit
separate payments.
Because TRAJAN WEALTH has the authority to deduct fees from Client
accounts, regulators consider the firm to have limited custody of Client assets
solely for billing purposes.
TRAJAN WEALTH does not take physical possession of your funds or securities.
Client assets are held with an independent, qualified custodian such as
Schwab or Axos.
Clients receive account statements directly from their custodian at least
quarterly. These statements reflect all activity in the account, including the
advisory fees deducted during each billing period.
Clients should carefully review these statements for accuracy and compare
them to any reports provided by TRAJAN WEALTH.
Discounted advisory fees may be available to family members and
associated persons of the firm.
Additional Client Fees Charged
In addition to the advisory fees paid to TRAJAN WEALTH, Clients may incur
other Custodial related fees associated with maintaining their account(s). If
applicable, these fees would be charged by the respective custodian and
utilized at their discretion. TRAJAN WEALTH participates in the Vendor payment
program through Axos.
TRAJAN WEALTH portfolios primarily utilize common stocks and exchange-
traded funds (ETFs) and in rare cases, a mutual fund may be used when an
ETF alternative is not practical. Both ETF’s and mutual funds charge internal
fees which are paid by the client directly to the fund. TRAJAN WEALTH does not
receive any portion of these fees.
Certain alternative investments available to accredited or qualified investors
may also involve additional expenses at the fund level. These may include
operating expenses such as legal, accounting, administrative, custodial,
trading, and other investment-related costs. TRAJAN WEALTH does not receive
any portion of these fees.
TRAJAN WEALTH is mindful of the fees and expenses associated with
investment products and actively seeks to utilize cost-efficient options.
Because TRAJAN WEALTH’s advisory fee is based on a percentage of assets
under management rather than commissions or transaction-based
compensation, our interests are aligned with those of our Clients. Our goal is
to help Clients grow and preserve their assets over time.
External Compensation for the Sale of Securities to Clients
TRAJAN WEALTH does not receive any external compensation for the sale of
securities to clients, nor do any of the Fiduciary Advisors of TRAJAN WEALTH.