Part 2A Brochure. Investus Financial Planning, Inc Santa Ana Ave, U-202 Costa Mesa, CA

Transcription

1 Part 2A Brochure Investus Financial Planning, Inc Santa Ana Ave, U-202 Costa Mesa, CA This brochure provides information about the qualifications and business practices of Investus Financial Planning, Inc. If you have any questions about the contents of this brochure, please contact us at The information in this brochure has not been approved or verified by the United States Securities and Exchange Commission or any state securities authority. Additional information about Investus Financial Planning, Inc. also is available on the SEC s website at The use of the term registered investment adviser does not imply a certain level of skill or training. February 15, 2011

2 Item 2 Material Changes There were no material changes to the brochure since the last annual update. This is the first version of the brochure in this format. 1

3 Item 3 Table of Contents Item 2 Material Changes... 1 Item 3 Table of Contents... 2 Item 4 Advisory Business... 3 Item 5 Fees and Compensation... 4 Item 6 Performance-Based Fees and Side-By-Side Management... 6 Item 7 Types of Clients... 7 Item 8 Methods of Analysis, Investment Strategies and Risk of Loss 7 Item 8.A Frequent Trading of Securities... 8 Item 8.B Material Risks of Particular Securities... 8 Item 9 Disciplinary Information... 8 Item 9.A Criminal or Civil Actions... 8 Item 9.B Administrative Proceedings... 8 Item 9.C Self-Regulatory Organization ( SRO ) Proceedings... 8 Item 10 Other Financial Industry Activities and Affiliations... 9 Item 10.A Broker-Dealer Registration... 9 Item 10.B Futures Commission Merchant/Commodities... 9 Item 10.C Relationships with Related Persons... 9 Item 10.D Relationships with Other Advisers... 9 Item 11 Code of Ethics, Participation or Interest in Client Transactions and Personal Trading... 9 Item 11.A Code of Ethics... 9 Item 11.B Participation or Interest in Client Transactions Item 11.C Personal Trading by Associated Persons Item 11.D Conflicts of Interest with Personal Trading by Associated Persons Item 12 Brokerage Practices Item 12.A Factors in Selecting or Recommending Broker-Dealers.. 10 Item 12.A1 Research and Other Soft Dollar Benefits Item 12.A2 Brokerage for Client Referrals Item 12.A3 Directed Brokerage Item 12.B Trade Aggregation Item 13 Review of Accounts Item 14 Client Referrals and Other Compensation Item 15 Custody Item 16 Investment Discretion Item 17 Voting Client Securities Item 18 Financial Information

4 Item 4 Advisory Business Investus Financial Planning, Inc. ( Investus ) has been in business since 2004 and is solely owned by Henk Pieters. Investus Financial Planning Inc. provides fee-only, consulting, financial planning and asset management services to individuals that is consistent with the individual client s financial and tax status, in addition to their risk profile and return objectives. The Adviser may also provide general non-securities advice on topics that may include tax, budgetary, estate and business planning. Consulting & Financial Planning These services are offered to clients that have simple consulting needs, require less comprehensive planning, for clients who wish to focus on specific aspects of their finances or have limited investable assets. Financial Planning & Investment Management Services Investus believes that it would be imprudent to manage a client s investments without a good idea of the client s financial situation so financial plans are included with investment and asset management services. The initial plan is usually presented during the first meeting and reviewed and updated at least yearly. These services cover development and implementation of the financial plan, ongoing updates of the plan, and all investment management. It also includes regular meetings either in person, by phone or electronically to keep the client informed and to discuss new issues. We attend meetings with client attorneys, insurance agents, and accountants to coordinate our efforts, with client goals always in mind. Financial Planning & Asset Management Services The services cover development and implementation of the financial plan, ongoing updates of the plan, continuous asset management to include investment management. 3

5 In addition, to the services described above this relationship could include advice on a client s real estate, career, business, auto and other purchases, and a myriad of other financial issues. Clients can impose restrictions on the investments that they want managed by Investus. Investus provides comprehensive planning that includes being the client s fiduciary, portfolio analysis, ongoing investment management, goal setting and monitoring, cash flow/budget review, tax minimization, estate planning, retirement analysis, education planning, insurance reviews, mortgage review and assistance, communicating with client s CPAs, attorneys and other advisors, major purchase assistance, financial education, and small business/career coaching. Assets Under Management As of 12/31/2010 Investus manages $31,574, on a discretionary basis and $3,848, on a non-discretionary basis for a total of $35,422, Financial Planning Conflicts of Interest When multiple services are offered, there is a potential conflict of interest since there is an incentive for the Adviser offering financial planning services to recommend products or services for which the Adviser, or a related party, may receive compensation. However, financial planning clients are under no obligation to act upon any recommendations of the Adviser or to affect any transactions through the Adviser if they decide to follow the recommendations. Item 5 Fees and Compensation Clients are charged an hourly, fixed or an asset-based fee for asset management, financial planning and consulting services. Fees are negotiable and are based on factors such as number of family members, scope of planning needs, cash flow, tax planning issues, and assets under management. Investus is a fee-only financial planning firm and does not charge any other fees or receive any other compensation. Investus considers fees for financial planning or consulting projects to be earned as progress is realized toward creation of the plan or completion of the service. 4

6 If the client elects the fixed fee or asset based fee and the client wants to have the fee deducted from their account, then the client can authorize the custodian holding client funds and securities to deduct Investus fees directly from client account in accordance with the summary invoices prepared and submitted by Investus. Client will receive a detailed informational invoice showing the amount of the fee, the value of the assets upon which the fee was based or the fixed fee prorated annually, and the specific manner in which the fee was calculated. It is the client s responsibility to verify the accuracy of the fee calculation. The custodian will not determine whether the fee is properly calculated. If there is inadequate cash in client account to pay the Investus fee, then it may be necessary to liquidate account assets, which may result in a loss to client. Investus will notify client before liquidating and client can choose to pay Investus directly. Clients should be aware that in addition to the fees that Investus charges, there might be fees such as custody, mutual fund expenses, brokerage transaction fees and other transaction fees. The custodian will notify the client of those fees via prospectus, confirmation s and quarterly statements. Although we recommend certain custodians, clients are free to choose any custodian that they desire. The financial plan fee is non-refundable after 5 business days following the presentation to the client at either an initial meeting or a yearly renewal meeting. This is due to the fact that quite a bit of upfront preparation and presentation time is spent developing, reviewing and presenting the plan. With the financial plan fee taken out of the full consulting fee, the remainder for either fixed or assets under management clients will be refunded during the first three months of the initial year of the engagement. After three months the refund shall be prorated based on the time the account has been managed. Client must provide Investus with written notice to terminate the relationship. 5

7 Consulting & Financial Planning Fees The hourly rate ranges from $150 to $250. Hourly fees are payable at the completion of the services. Hourly fees are recommended for clients that have simple consulting needs or require less comprehensive planning or for clients who wish to focus on specific aspects of their finances. Financial Planning & Investment Management Fees The initial financial plan fee is, at our discretion, valued between $750- $1,500 depending on the complexity of the client s portfolio. The fixed fee ranges from $1,500 to $12,000. There is a minimum fee of $1,800 for a couple. Fixed fees are payable in advance or on a monthly or quarterly basis in arrears. Fixed fees are recommended for clients that require comprehensive financial planning. Financial Planning & Asset Management Services The asset based fee is not often used with clients. Asset based fees are recommended for clients that require comprehensive financial planning, investment and other asset management services. From To Per Year Minimum Fee Under $180,000 $1,800 $180,000 $999, % $1,000,000 $1,999, % Over $2,000, % Asset based fees are payable in advance or on a monthly or quarterly basis in arrears. Item 6 Performance-Based Fees and Side-By-Side Management The Adviser does not charge or receive, directly or indirectly, any performance-based fees. 6

8 Item 7 Types of Clients The vast majority of Investus clients are individuals to include their trusts, and estates. Investus also provides services to charitable organizations, and corporations. Investus prefers clients with at least $250,000 of investable assets, but does not have a formal minimum requirement. Item 8 Methods of Analysis, Investment Strategies and Risk of Loss Investus uses various methods of analysis and investment strategies both in providing advice and managing assets. Analysis The most important method is fundamental analysis. Technical analysis is also used but to a much lesser extent. Strategies Investus is a long-term value investor that recommends and builds diversified portfolios for clients. Risk of Loss Clients take a risk assessment quiz and are advised that investing in securities involves the risk of loss of the entire principal amount including any gains. Clients should not invest unless they are able to bear these losses. Any of the above investment strategies may lead to a loss on investments. Even hedging strategies may fail if markets move against the hedged investments. In addition, investing carries with it opportunity risk it is impossible to accurately predict the sectors of the market or asset classes that will have more favorable returns for a given period. Any type of analysis runs the risk that if incorrectly performed or unforeseen events affect the market, then there could be a material risk and clients investments could lose money. 7

9 Item 8.A Frequent Trading of Securities Investus rarely engage in frequent trading as that affects performance, increases transaction costs and clients tax burden. Item 8.B Material Risks of Particular Securities Investus doesn t recommend a type of security that involves significant or unusual risks. Item 9 Disciplinary Information Investus does not have any previous or pending disciplinary or legal actions to disclose. Item 9.A Criminal or Civil Actions Neither Investus nor any management person has been found guilty of or has any criminal or civil actions pending in a domestic, foreign or military court. Item 9.B Administrative Proceedings Neither Investus nor any management person has any administrative proceedings pending before the SEC, any other federal regulatory agency, any state regulatory agency, or any foreign financial regulatory authority. Item 9.C Self-Regulatory Organization ( SRO ) Proceedings Neither Investus nor any management person have been found by any SRO to have caused an investment-related business to lose its authorization to do business, or to have been involved in a violation of the SRO s rules, or were barred or suspended from membership or from association with other members, or were expelled from membership, otherwise significantly limited from investment-related activities, or fined. 8

10 Item 10 Other Financial Industry Activities and Affiliations Investus does not have any other business activities or affiliations. Item 10.A Broker-Dealer Registration Neither Investus nor any management person is or owns a securities broker-dealer registered with the Securities and Exchange Commission ( SEC ) and a member of the Financial Industry Regulatory Authority ( FINRA ) or has an application for registration pending. No associated person is a registered representative of a broker-dealer. Item 10.B Futures Commission Merchant/Commodities Neither Investus nor any management person is a commodity broker/futures commission merchant, a commodity pool operator, commodity trading advisor or an associated person for the foregoing entities or has an application for registration pending. Item 10.C Relationships with Related Persons Neither Investus nor any management person has any material relationships with related persons that create a material conflict of interest with clients. Item 10.D Relationships with Other Advisers Neither Investus nor any management person has any other material relationships or conflicts of interest with any related financial industry participants. Item 11 Code of Ethics, Participation or Interest in Client Transactions and Personal Trading Item 11.A Code of Ethics Investus has adopted a Code of Ethics. The Code sets forth the standards of business conduct we will adhere to. It requires, among other things, that Investus comply with applicable federal securities laws: recognize its fiduciary oath to clients, and place the client s interests before its own. A current copy of the Code will be provided to clients and prospective clients upon request. 9

11 Item 11.B Participation or Interest in Client Transactions Investus may buy securities that are recommended to clients. Neither Investus nor any associated person recommends to clients, or buys or sells for client accounts, securities in which Investus or an associated person has a material financial interest. Neither the Adviser nor any associated person acting as a principal, buys securities from (or sells securities to) clients; acts as general partner in a partnership in which Adviser solicits client investments; or acts as an investment adviser to an investment company that Adviser recommends to clients. Item 11.C Personal Trading by Associated Persons Investus recommends that clients invest in various securities. Mr. Pieters may own an interest in or buy or sell for his accounts the same securities, which may be purchased or sold in the accounts of advisory clients. See Item 11.D for conflicts of interest. Item 11.D Conflicts of Interest with Personal Trading by Associated Persons Mr. Pieters seeks to ensure that he does not personally benefit from the short-term market effects of his recommendations to clients. Mr. Pieters is aware of the rules regarding material non-public information and insider trading. Mr. Pieters may also buy or sell a specific security for his account based on personal investment considerations, which the Adviser does not deem appropriate to buy or sell for clients. Item 12 Brokerage Practices Item 12.A Factors in Selecting or Recommending Broker- Dealers Investus makes custodial recommendations that are based on the Investus perception of the breadth of services offered, and quality of execution. However, the client may pay commissions or fees that are 10

12 higher or lower than those that may be obtained from elsewhere for similar services. Clients are advised that they are under no obligation to act on the recommendations of the Adviser. The client may pay commissions or fees that are higher or lower than those that may be obtained from elsewhere for similar services. Clients are advised that they are under no obligation to act on the recommendations of the Adviser. Investus does not engage in trade aggregation (bunching) and that could increase client transaction cost. Item 12.A1 Research and Other Soft Dollar Benefits Investus does not direct or indirectly receive any soft dollars benefits. The term "soft dollars" refers to funds which are generated by client trades being used to pay for products and services from or through the broker-dealers an investment adviser engages to execute securities transactions. Item 12.A2 Brokerage for Client Referrals Investus does not refer clients to particular broker-dealers in exchange for client referrals from those broker-dealers. Item 12.A3 Directed Brokerage Clients may direct their brokerage business to the broker dealer of their choosing. However, as a result, the client may be unable to obtain the most favorable execution. Clients may also pay higher commissions, transaction and brokerage fees than may be available from other broker-dealers. Item 12.B Trade Aggregation Investus primarily recommends and invests client assets in mutual funds and ETFs. The Adviser s investment strategies do not generally present an opportunity to aggregate trades. Investus does not engage in trade aggregation (bunching) and that could increase client transaction cost. 11

13 Item 13 Review of Accounts Mr. Pieters performs reviews of all investment advisory accounts no less than quarterly. Accounts are reviewed for consistency with the investment strategy and performance. Reviews may be triggered by changes in an account holder s personal, tax or financial status. Macroeconomic and company specific events may also trigger reviews. There is currently no limit on the number of accounts that can be reviewed by Mr. Pieters. Written client reports are generated at least twice a year and presented in person or on a conference call. Brokerage statements are generated no less than quarterly and they are sent directly from the account custodian. These reports list the account positions, activity in the account over the covered period, and other related information. Clients are also sent confirmations following each brokerage account transaction unless confirmations have been waived. Item 14 Client Referrals and Other Compensation Investus does not have an arrangement under which it or any related person compensates others for client referrals. The Adviser doesn t receive any economic benefit from a person who is not a client for providing advisory services to clients. Item 15 Custody The Adviser doesn t accept custody of client funds or securities. Client assets are held by qualified custodians. Item 16 Investment Discretion Under some circumstances Investus may be granted the authority to select the amount of securities to be bought or sold without specific client consent. Investus acts in accordance with the client s stated investment objectives, risk tolerance and restrictions without obtaining specific 12

14 client consent. Investus will not have discretion over the selection of the broker to be used and the commission rates to be paid. Item 17 Voting Client Securities Investus does not accept authority to vote proxies on behalf of clients. Clients will receive their proxy information directly from their custodian. Clients may contact Investus by telephone at (949) if they have additional question about this issue. Item 18 Financial Information Investus does not charge more than $1,200 six or more months in advance of providing services. Clients receive ongoing services so an audited balance sheet is not needed. Investus do not have any financial impairment such as a large judgment which would not allow Investus to meet its contractual commitments. Neither Investus nor any management person has been part of a bankruptcy in the last ten years. 13

15 Part 2B Brochure Supplement Henk Jeroom Pieters Investus Financial Planning, Inc Santa Ana Ave, U-202 Costa Mesa, CA This brochure supplement provides information about Mr. Henk Pieters that supplements the Investus Financial Planning, Inc. brochure. You should have received a copy of that brochure. Please contact us at the number above if you did not receive Investus Financial Planning, Inc. s brochure or if you have any questions about the contents of this supplement. Additional information about Mr. Henk Pieters is available on the SEC s website at February 15, 2011

16 Item 2 Educational Background and Business Experience Mr. Pieters was born in He received a Bachelor of Science with a major in Business Administration from California Polytechnic State University, San Luis Obispo in He also received a Master of Business Administration (MBA) from Pepperdine University in Mr. Pieters has earned and maintains a professional designation. The designation and minimum qualification requirements follow: CERTIFIED FINANCIAL PLANNER (CFP ) [2010] Coursework To earn the certification recipients must meet the following qualifications: Complete courses that cover integrated financial planning topics such as: General principles of financial planning Insurance planning and risk management Employee benefits planning Investment planning Income tax planning Retirement planning Estate planning Bachelor's Degree In addition to completing the course work a bachelor's degree or higher, or its equivalent is required. Degrees can be in any discipline but must be from an accredited college or university; verified through official transcripts from the degree-granting institution. The bachelor's degree is a requirement for certification but is not a requirement to be eligible to take the examination. Work Experience Applicants have five years from the date they pass the examination to satisfy the bachelor's degree and work experience requirements. 1

17 Applicants must supervise, directly support, teach or personally deliver all or part of the personal financial planning process to a client. Qualifying experience must fit within one or more of the six primary elements of the personal financial planning process described below: Establishing and Defining the Relationship with the Client This includes explaining the issues and concepts related to the personal financial planning process, and clearly specifying the services the individual or firm will provide and the associated responsibilities. Gathering Client Data Including Goals This includes interviewing or questioning the client about various aspects of their financial resources, obligations and expectations. It also involves helping to determine client's goals, needs and priorities; assessing client's values and attitudes; and determining their time horizons and risk tolerance, in addition, to collecting applicable records and documents. Analyzing and Evaluating the Client's Financial Status This involves analyzing and evaluating client data such as current cash flow needs, risk management, investments, taxes, retirement, employee benefits, estate planning, and special needs. Developing and Presenting Financial Planning Recommendations and/or Alternatives This process includes presenting and reviewing recommendations, working to ensure that the plan meets the goals and expectations of the client, and revising the recommendations as necessary. Implementing the Financial Planning Recommendations This involves helping the client put the financial planning recommendations into action and may include coordinating with other professionals, such as accountants, attorneys, real estate agents, stockbrokers and insurance agents. Monitoring the Financial Planning Recommendations This involves discussing with the client any changes in their personal circumstances, evaluating changing tax laws, and making recommendations based on new or changing conditions. Standards of Professional Conduct Applicants are required to meet the CFP Board s Candidate Fitness Standards, which describe conduct that: 1) is unacceptable and will always bar an individual from becoming certified; or 2) is presumed to 2

18 be unacceptable and will bar an individual from becoming certified unless the individual successfully petition the CFP Board. Before being authorized to use the CFP certification marks, and in conjunction certificate renewal, applicants and holders of the certificate must disclose any criminal, civil, self-regulatory organization or governmental agency inquiry, investigation or proceeding involvement. Applicants and holders must also acknowledge the right of CFP Board to enforce its Standards of Professional Conduct. Business Experience Firm Name and Title Investus Financial Planning, Inc., President, CCO Dates 07/2004 to present Item 3 Disciplinary Information Mr. Pieters does not have any legal or disciplinary events to disclose. Mr. Pieters is not the subject of any pending legal, disciplinary or administrative proceedings. Item 4 Other Business Activities Neither Investus nor Mr. Pieters are involved in any other business activities. Neither Investus nor Mr. Pieters have any affiliations. Item 5 Additional Compensation See Item 4 above. Item 6 Supervision Mr. Pieters is the President and the only person who is performing advisory activities. 3