Article by Jane King, founder, and Caroline Hedges, associate, Fairfield Financial Advisors

Link to article:
https://uk.finance.yahoo.com/news/birds-bees-sure-parents-really-125800397.html

FORM CRS

June 10, 2020

Fairfield Financial Advisors, Ltd. is registered with the Securities and Exchange Commission as an investment adviser and, as such, we provide advisory services rather than brokerage services. Brokerage and investment advisory services and fees differ and it is important for you, our client, to understand the differences. Additionally, free and simple tools are available to research firms and financial professionals at Investor.gov/CRS, which also provides educational materials about broker-dealers, investment advisers, and investing. This document is a summary of the services and fees we offer to “retail” investors, which are natural persons who seek or receive services primarily for personal, family, or household purposes.

What investment services and advice can you provide me?

We offer the following investment advisory services to retail investors: Portfolio Management Services and Financial Planning Services. Detailed information regarding our services, fees and other disclosures can be found in our Form ADV Part 2A Brochure Items 4, 7, 13 and 16 by visiting the following website:
https://adviserinfo.sec.gov/firm/brochure/106408.

Account Monitoring When you open an investment account with our firm, as part of our standard service, we will monitor your investments on a mutually-agreed upon cycle with the caveat of responding to unexpected events in the market or in the social environment more immediately. This account monitoring is an addition to the continuous monitoring of day-to-day deposits, withdrawals and other maintenance of your account.

Investment Authority We manage investment accounts on a non-discretionary basis whereby we will propose investments to buy or sell for your account and you will have full approval or disapproval rights to the proposal in its entirety or to portions of the proposal. You may refine the types of securities that can be purchased or sold for your account by providing our firm with your restrictions and guidelines in writing in a timely manner.

We also offer discretionary investment management services whereby we will decide, given a mutual assessment of your investment needs, and implement the buying and selling for your account. You have the right to refine our buying and selling of types of certain securities by providing your restrictions to us in writing in a timely manner.

Investment Offerings
We offer advice on the following types of investments or products: equity securities, mutual funds, certificates of deposit, United States government securities, money market funds and exchange-traded funds.

Account Minimums and Requirements In general, we do not require a minimum dollar amount to open and maintain an advisory account; however, we have the right to suggest the termination of your account if it falls below a minimum size which, in our sole opinion, provides sufficient value in light of the management fees.

Key Questions to Ask Your Financial Professional

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?

What fees will I pay?

The following summarizes the principal fees and costs associated with engaging our firm for investment advisory services. For detailed information, refer to our Form ADV Part 2A Brochure, Items 5 and 6 by visiting the following website:
https://adviserinfo.sec.gov/firm/brochure/106408.

Asset Based Fees – This management fee is payable mid-quarter for the current quarter. The fee is based on the account’s closing market value as of the last day of the preceding month of each quarter. In other words, the fee is based on the closing market value at the end of the second month of each quarter. Since the fees we receive are asset-based (i.e. based on the value of your account), we have an incentive to increase your account value which creates a conflict especially for those accounts holding illiquid or hard-to-value assets. All additional fees are charged by the custodian, Charles Schwab, and, in some cases, by the mutual fund management company.

Examples of the most common additional fees and costs applicable to our clients are:

Custodial trading commission fees;
Custodial fees for services such as wires and returned checks;
Custodial fees or fund managers’ fees related to mutual funds and exchange-traded funds; and
Other custodial product-level fees associated with your investments.

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.

Key Questions to Ask Your Financial Professional

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?

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.

Because our revenue is derived from asset-based fees, we have an incentive to grow your account as much as possible. This could cause us to take overly aggressive positions in conflict with your interests in an attempt to grow your account, or could incentivize us to inflate the valuations of illiquid investments held in your account. However, as a fiduciary, your risk profile is central to our investment selection. Illiquid assets in your portfolio would not be included in the fee calculation to avoid any conflict of interest concerning the valuation of such security.

Refer to our Form ADV Part 2A Brochure by visiting the following website: https://adviserinfo.sec.gov/firm/brochure/106408 to help you understand what conflicts exist.

Key Questions to Ask Your Financial Professional

How might your conflicts of interest affect me, and how will you address them?

How do your financial professionals make money?

The financial professionals who are servicing your account(s) are compensated in the form of salary and bonus based on competitive market rates. The bonus compensation paid to our financial professionals involves a conflict of interest because they have a financial incentive to refer clients to our firm. No bonuses are paid for referral of clients to our firm.

Do you or your financial professionals have legal or disciplinary history?

No, our firm and our financial professionals currently do not have any legal or disciplinary history to disclose. Visit Investor.gov/CRS for a free and simple research tool.

Key Questions to Ask Your Financial Professional

As a financial professional, do you have any disciplinary history? For what type of conduct?

You can find additional information about your investment advisory services with our firm and request a copy of the relationship summary at 781-431-1119 or by visiting the following website: https://adviserinfo.sec.gov/firm/brochure/106408.

Key Questions to Ask Your Financial Professional