June 30, 2022
Customer Relationship Summary
Helping you make an informed decision Form CRS
Introduction
Ferguson Shapiro LLC (“Ferguson Shapiro”) is registered with the Securities and Exchange Commission as an investment adviser. Brokerage and investment advisory services and fees differ, and it is important for the retail investor to understand the differences. Free and simple tools are available to research firms and financial professionals at Investor.gov/CRS, a website maintained by the SEC. These tools can provide you with educational materials about broker-dealers, investment advisers, and investing.
Terms to know
• A broker-dealer is a firm that acts as an intermediary between buyers and sellers of securities for which they will usually receive a commission and may purchase or sell those securities in/out of their own account.
• An investment adviser is generally any person or group that provides investment advice or conducts securities analysis in exchange for a fee.
Relationships and Services
What investment services and advice can you provide me?
Ferguson Shapiro offers investment advisory services to retail investors giving continuous advice based on the client’s individual needs. Services are offered through a wrap fee program or a non-wrap fee program. In a wrap fee program, clients are charged an all-inclusive wrap fee that covers advisory and execution services. Advisory services are offered by defining client objectives, preparing a financial and investment plan, selecting appropriate investments, implementing the plan, and monitoring progress. Third-party money managers may be recommended as part of the advisory services offered depending on your asset allocation and asset management service needs. Advisory accounts are assigned to Investment Advisors who are responsible for performing periodic reviews and consulting with the respective client at least annually.
Ferguson Shapiro also offers financial planning for a fee which can provide the client with a written financial plan addressing personal; tax and cash flow; death and disability; retirement; and/or investment needs. If financial planning is provided as a stand-alone service, then once a financial plan is delivered, we do not commit to provide on-going monitoring of your assets.
Ferguson Shapiro typically provides advisory services on a discretionary basis, but does offer the same services on a non-discretionary account basis. In a discretionary account, the Adviser will have the authority to determine which securities are bought and sold without prior consultation with the client. Discretion is exercised in a manner consistent with the client’s stated objectives, and any restrictions the client provides in writing. In a non-discretionary account, the client makes the ultimate decision regarding the purchase or sale of investments. Discretionary authority is provided as part of the Client Agreement. While we do not have a minimum individual account size, the family household minimum is $100,000. This minimum may be negotiated in certain instances.
Additional information about services provided can be found on the company’s website at: fergusonshapiro.com and on Ferguson Shapiro’s ADV Disclosure Brochure (Form ADV Part 2A Brochure, Items 4, 7, 13 and 16; or Form ADV Part 2A Appendix 1 Wrap Fee Program Brochure, Items 4 and 9).
Fees, Costs, Conflicts, and Standard of Conduct
What fees will I pay?
For advisory services, Ferguson Shapiro charges most retail investors an annualized asset-based fee, billed monthly in advance of service. If clients choose a wrap fee program, asset-based fees associated with the wrap fee program will include most transaction costs and fees to the broker-dealer that has custody of these assets, and therefore are higher than a typical asset-based advisory fee. Fees will be debited from your account, as instructed on your advisory agreement. The more assets there are in a retail investor’s advisory account, the more a retail investor will pay in fees, and this creates an incentive for us to encourage you to increase the assets in your account.
If you choose financial planning, without engaging us for ongoing advisory services, we will charge either an hourly fee. All fees will be disclosed and agreed upon in the financial planning agreement before we start work.
Aside from the fees we charge you for providing investment advice, you may have to pay other fees related to brokerage or investment advisory services. Fees can be charged directly or indirectly. Direct fees include transaction fees (in a non-wrap fee program) and account maintenance fees (including IRA fees) charged by Charles Schwab & Co., Inc., a FINRA registered broker-dealer, member SIPC. Additional direct fees include prime broker fees, deferred sales charges, odd-lot differentials, transfer fees, wire transfer, electronic fund fees, and other fees and taxes on brokerage accounts and securities transactions. Indirect fees include internal management fees (including 12b-1 fees and annual fund operating expenses) charged by mutual funds and exchange traded funds, which are disclosed in a fund’s prospectus.
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.
Additional information about fees provided can be found on your advisory agreement and on Ferguson Shapiro’s ADV Disclosure Brochure (Form ADV Part 2A Brochure, Item 5; or Form ADV Part 2A Appendix 1 Wrap Fee Program Brochure, Item 4).
What are your legal obligations to me when acting as my investment adviser? How else does the 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 is an example to help you understand what this means.
Ferguson Shapiro is separately registered as an insurance agency and Individual Investment Adviser Representatives are licensed as insurance agents, offering Variable Annuities, Life, Health, Long Term Care, Disability and other insurance products. Fees and commissions charged in connection with insurance products are separate and distinct from advisory fees paid. This poses a conflict of interest to the extent that there is a financial incentive to recommend insurance products that result in commissions, trails or other payments.
Additional information about conflicts of interest can be found on Ferguson Shapiro’s ADV Disclosure Brochure (Form ADV Part 2A Brochure, Item 10; or Form ADV Part 2A Appendix 1 Wrap Fee Program Brochure, Item 9).
How do your financial professionals make money?
Investment Adviser Representatives are paid based on their ownership in Ferguson Shapiro and is indirectly based on a portion of the fees you pay. The fees charged to you can vary from fees charged to other clients based on the amount of assets managed by your advisor, or the time and complexity needed to meet your needs.
Do you or your financial professionals have legal or disciplinary history?
Yes. Visit Investor.gov/CRS for a free and simple search tool to research the Firm and our financial professionals.
Where can I find additional information?
Additional information about Ferguson Shapiro can be found on the company’s website at: fergusonshapiro.com and on Ferguson Shapiro’s ADV Disclosure Brochure (Form ADV Part 2A Brochure; or Form ADV Part 2A Appendix 1 Wrap Fee Program Brochure).
You can always ask your financial advisor for more information and request a copy of this relationship summary at (404) 567-6771.
For more information:
• Call (404) 567-6771
• Learn more at Investor.gov/CRS