Client Relationship Summary
Item 1 – Introduction
CRA Financial, LLC (“CRA”, “we” or “us”) is registered with the Securities Exchange Commission (“SEC”) as a Registered Investment Adviser (“RIA”). As an RIA, our services and compensation structure differ from that of a registered broker-dealer, and it is important for you to understand the differences. Free and simple tools are available to research firms and financial professionals at Investor.gov/CRS. The site also provides educational materials about broker-dealers, investment advisers and investing.
Item 2 – Relationships and Services
What investment services and advice can you provide me?
We provide investment advisory services, including discretionary or non-discretionary investment management and financial planning and consulting services to individuals, trusts, and estates (our “retail investors”).
When a retail investor engages us to provide investment management services we shall monitor, on a continuous basis, the investments in the accounts over which we have investment authority as part of our investment management service. Furthermore, when engaged on a discretionary basis, we shall have the authority, without prior consultation with you (unless you impose restrictions on our discretionary authority), to buy, sell, trade and allocate the investments within your account(s) consistent with your investment objectives. When engaged on a non-discretionary basis, you make the ultimate decision regarding the purchase or sale of investments. In either case, our investment authority over your account(s) shall continue until our engagement is terminated.
When a retail investor engages us to provide financial planning and consulting services, we rely upon the information provided for our review and do not verify or monitor any such information while providing this service. Our financial planning and consulting services are completed upon the communication of our recommendations to the retail investor.
We do not limit the scope of our investment advisory services to proprietary products or a limited group or type of investment. We generally do not impose a minimum required asset level or minimum annual fee for our investment advisory services.
Additional Information: For more detailed information about our Advisory Business and the Types of Clients we generally service, please see Items 4 and 7, respectively in our ADV Part 2A.
Given my financial situation, should I choose an investment advisory service? Why or why not? How will you choose investments to recommend to me? What is your relevant experience, including your licenses, education and other qualifications? What do these qualifications mean?
Item 3 – Fees, Costs, Conflicts, and Standard of Conduct
What fees will I pay?
We provide our investment advisory services on a fee basis. When engaged to provide investment management services, we shall charge a fee calculated as a percentage of your assets under our management (our “AUM Fee”). Our annual AUM Fee shall generally range from 0.75% to 1.00% of client assets. CRA may negotiate to charge a lesser management fee depending on a number of factors including the dollar amount of assets placed under our management, the representative assigned to the account, the complexity of the overall engagement, and other factors. We typically deduct our AUM Fee, prorated, from one or more of your investment accounts, in advance, on a quarterly basis. Because our AUM Fee is calculated as a percentage of your assets under management, the more assets you have in your advisory account, the more you will pay us for our investment management services. Therefore, we have an incentive to encourage you to increase the assets maintained in accounts we manage.
We may offer our financial planning and consulting services on a fixed fee basis, starting from $1,000 to $5,000, or on an hourly rate basis at a rate of $300 per hour. We may require that up to 50% of the total fee be paid in advance. If a financial planning and consulting client engages CRA for investment advisory services, CRA may offset all or a portion of its financial planning and/or consulting fees against the fees incurred for investment management.
Other Fees and Costs: Your investment assets will be held with a qualified custodian. Custodians generally charge brokerage commissions and/or transaction fees for effecting certain securities transactions (for example, transaction and redemption fees may be charged for certain mutual fund transactions). These charges will be assessed in accordance with the qualified custodian’s transaction fee/brokerage commission fee schedule. We may allocate (and/or recommend that the client allocate) a portion of a client’s investment assets among unaffiliated independent investment managers. The fees charged by such independent investment managers are generally separate from and in addition to our fees. In addition, relative to certain mutual fund and exchange traded fund purchases, certain charges will be imposed at the fund level (e.g. management fees and other fund expenses).
You will pay fees and costs whether you make or lose money on your investments. Fees and costs will reduce any amount of money you make on your investments over time. Please make sure you understand what fees and costs you are paying.
Help me understand how these fees and costs might affect my investments. If I give you $10,000 to invest, how much will go to fees and costs, and how much will be invested for me?
Additional Information: For more detailed information about our fees and costs related to our management of your account, please see Item 5 in our ADV Part 2A.
What are your legal obligations to me when acting as my investment adviser? How else does your firm make money and what conflicts of interest do you have?
When we act as your investment adviser, we have to act in your best interest and not put our interest ahead of yours. At the same time, the way we make money creates some conflicts with your interests. You should understand and ask us about these conflicts because they can affect the investment advice we provide you. Here are some examples to help you understand what this means:
* We may recommend a particular custodian from whom we receive support services and/or products, certain of which assist us to better monitor and service your account.
* We may recommend rollovers out of employer-sponsored retirement plans and into Individual Retirement Accounts. Such a recommendation would present a conflict of interest if we earned new, or increased our current, advisory compensation as a result of the recommendation.
* We may recommend the services of certain affiliated entities, which presents a conflict of interest in that the recommendation could be made on the basis of fees to be collected by such affiliate.
How might your conflicts of interest affect me, and how will you address them?
Additional Information: For more detailed information about our conflicts of interest, please review our ADV Part 2A.
How do your financial professionals make money?
Our financial professionals are compensated on a salary basis, with a discretionary bonus component. Financial professionals compensated on a salary basis do not receive additional compensation based upon the amount of assets they are responsible for managing nor do they receive higher compensation when working with complex portfolios. Our financial professionals may receive an annual bonus, which is generally based on the overall performance of the firm. You should discuss your financial professional’s compensation directly with your financial professional.
Item 4 – Disciplinary History
Do you or your financial professionals have legal or disciplinary history?
We encourage you to visit www.Investor.gov/CRS to research our firm and our financial professionals. Furthermore, we encourage you to ask your financial professional: As a financial professional, do you have any disciplinary history? If so, for what type of conduct?
Item 5 – Additional Information
Additional information about our firm is available on the SEC’s website at www.adviserinfo.sec.gov. You may contact our Chief Compliance Officer at any time to request a current copy of your ADV Part 2A or our relationship summary. Our Chief Compliance Officer may be reached by phone: (609) 380-3500.
Who is my primary contact person? Is he or she a representative of an investment adviser or broker-dealer? Who can I talk to if I have concerns about how this person is treating me?
Exhibit of Material Changes
Since our most recent filing dated June 29, 2020, this Client Relationship Summary has been revised as follows:
At Item 2 to discuss non-discretionary investment management services
At Item 3 to discuss fees that may be assessed by unaffiliated independent investment managers