Thompson Financial Firm
Bianca Thompson, CFP® 5678 J Street, NW Washington, DC 20008
October 15, 2021
Clarence Ramirez
1234 J Street, NW
Washington, DC 20008
Dear Clarence:
I enjoyed our conversation and I am pleased to be working with you. This letter gives you important information
about the work that we (my firm and I) will do for you, how you will pay for services and products, and how we will
be paid for the work that we will do for you.
Drafting Notes: If your previous communication with the client was not a conversation (it might have been an email,
for example), then change the language here and in the We Will Provide You the Following Services and Products
section (below).
You will find other important information and a description of my obligation to act in your best interests in my firm’s
Client Relationship Summary (Form CRS), Form ADV, and Investment Advisory Agreement. These documents
provide additional information not in this letter, including about how you will pay and how we are paid. We gave you
these documents. You should review them carefully and let us know if you have any questions.
Drafting Notes: Confirm that the document titles in the paragraph above and in the first sentence in the How You
Will Pay for Services and Products section (below) match the titles on the documents you gave your client. If they
differ, then change the titles in this letter to match those on your documents. If you have provided other documents
that describe the information addressed in this letter, then you should add those titles to the list above.
If you have enclosed or attached the documents to this letter or provided the documents in separate
correspondence, then change the language above and in the How You Will Pay for Services and Products section
(below).
If you want to provide information about the fiduciary duty set forth in CFP Board’s Code and Standards, then after
you consider your firm’s policies and procedures and consult with your manager, compliance officer, or other
appropriate person, you could provide that information here. Consider adding this language: “As we discussed I am
a CFP® professional and have agreed to comply with CFP Board’s Code of Ethics and Standards of Conduct. The
Code and Standards includes a fiduciary duty, which provides that ‘At all times when providing financial advice to a
client, a CFP® professional must act as a fiduciary, and therefore, act in the best interests of the client.’”
WE WILL PROVIDE YOU THE FOLLOWING SERVICES AND PRODUCTS
You have engaged us to provide financial planning, including investment advisory services. Based on our recent
conversation, we understand that you would like to focus on the following:
1. Cash flow planning, including preparing a cash flow summary and planning for an emergency fund;
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Thompson Financial Firm
Bianca Thompson, CFP® 5678 J Street, NW Washington, DC 20008
2. Investment planning, including reviewing your current investment portfolio and developing and
implementing an asset management strategy;
3. Retirement planning, including analyzing how likely you are to meet your target goals by your retirement
date; and
4. Estate, gift, and wealth transfer planning, including assessing your estate net worth and liquidity, and
whether you should create a trust for the benefit of your grandchildren.
Drafting Notes: The above services and their descriptions are examples. The information that you provide in your
client letters will be specific to your clients.
In your client letters, you may list more or less information than shown here. For example, if you will discuss estate
planning with a client, then you might specifically identify the client’s needs (such as a trust for the benefit of the
grandchildren, as provided in the example). Or you might limit your services and recommend that the client obtain
advice from an attorney who specializes in estate planning. With either approach, you may want to add language to
address legal or other concerns.
Here is our approach to financial planning:
1. At first, we will ask you for information, so we can understand your personal and financial circumstances.
2. Then we will work with you to identify and select goals.
3. After you have chosen goals, we will analyze your current course of action and other approaches you might
take.
4. Next, we will develop the financial planning recommendations.
5. Then we will present the financial planning recommendations to you, along with the information we
considered to develop them.
6. After that, we will analyze and recommend actions, products, and services to implement the financial
planning recommendations. We will work with you to decide which of my recommendations you would like
to implement.
7. At least annually, we will monitor your financial plan. This will include:
a. Analyzing the progress you have made toward achieving your goals. We will remind you to tell us
about changes in your personal and financial circumstances. When needed, we will update your
goals, our recommendations, and the selection of the actions, products, and services we have
recommended.
b. Monitoring the investments in your Investment Advisory Account and any actions we have taken.
Drafting Notes: The language above is based on how CFP Board describes the financial planning process. Your
description may be different from the example above, so long as it is accurate and consistent with CFP Board’s
Practice Standards for the Financial Planning Process. While you must follow the seven-step process, you are not
required to use seven numbered bullets to explain it.
If you and the client have agreed that you will not provide implementation, monitoring, and/or updating services,
then you should delete those steps from this section and explicitly state that you will not provide those services.
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Thompson Financial Firm
Bianca Thompson, CFP® 5678 J Street, NW Washington, DC 20008
The monitoring obligation for the financial planning recommendations aligns with CFP Board’s Practice Standards
for the Financial Planning Process. Under certain circumstances, you also may have a monitoring obligation under
relevant law, rule, or regulation. You should consider the effect that the monitoring language you include in this
letter may have on your legal or regulatory requirements.
Here is our approach to providing you with investment advisory services:
1. At the beginning, we will meet with you to develop investment goals and strategies that are consistent with
your financial planning goals.
2. We gave you our Investment Advisory Agreement. It describes our advisory relationship and my firm’s
investment practices that apply to you. We will manage the Investment Advisory Account on a discretionary
basis. That means we will buy and sell investments for the accounts without first getting your specific
authorization for each transaction. We will base these decisions solely on our best judgment about what is
in your best interests at that time.
Drafting Notes: The above services and their descriptions are examples. The information you provide in your client
letters will be specific to your clients.
If needed, change the title of the document in the second numbered bullet above (Investment Advisory Agreement)
to match the precise title of your document.
If your Investment Advisory Agreement does not give you discretionary authority to buy and sell investments, then
replace the last three sentences in the second numbered item above with information relevant to your client,
including how you or your firm will obtain the client’s trade authorization.
3. We will help you choose a firm (such as a broker-dealer or a bank) to hold (have custody of) the assets that
we will manage for you. A separate custodial agreement will outline how your assets will be held and how
you may access your assets.
Drafting Notes: If your firm recommends a specific asset custodian, then modify the language to identify that firm.
If your firm is the custodian for the client’s funds, then change the language to reflect that arrangement.
4. My firm will send you a report each calendar quarter that will show the value of your accounts, your
accounts’ performance, and other account-related information. The report will show all transactions made in
the accounts during the quarter, and any costs or fees deducted from your accounts. In the meantime, you
can access your monthly statement online.
Drafting Notes: If the broker-dealer or another firm sends reports to clients, then change the language to reflect that
information.
If your firm sends reports on a different schedule, then modify the language accordingly. If your firm does not send
reports but makes them available to the client only online, then modify the language.
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Thompson Financial Firm
Bianca Thompson, CFP® 5678 J Street, NW Washington, DC 20008 If
your firm does not provide access to reports online, or if the reports do not show the information described, then
modify the language.
5. We will monitor these accounts and when appropriate, update your goals, our recommendations, and the
selection of the actions, products, and services we have recommended.
As we learn more about your needs, we may discover other services you may need. If you need services that we do
not provide, such as accounting and legal services, then we also may be able to recommend professionals to
provide those services.
Drafting Notes: If the examples in the second sentence above (accounting and legal services) are not relevant to
your practice, please provide examples that are.
HOW YOU WILL PAY FOR SERVICES AND PRODUCTS
My firm’s Form CRS, Form ADV, and Investment Advisory Agreement include more information about how you will
pay for products and services. We gave you these documents. You also can access them online. We will help you
understand the fees you will pay and the cost of any services and products we recommend. Let us know if you have
any questions.
Drafting Notes: Confirm that the document titles in the first sentence above match the titles on the documents you
gave your client. If they differ, then, change the titles in this letter to match those on your documents. You also
might note (if true) that your firm’s Form CRS and/or Form ADV is available on the firm’s website and provide the
link to that website. If you have given your client documents that describe the information addressed in this letter,
then you should add those titles to the list above.
If your firm does not give clients online access to the documents, then modify the language above.
If you can provide more specific information about how much or what types of fees and expenses the client will pay,
then you should add that information.
You will pay an advisory fee each quarter. The advisory fee covers our costs to manage your assets and
provide other financial planning services. My firm will deduct the fee from your accounts based on the
average of the values of the Investment Advisory Account on the last business day of each of the last
three months. The amount of the fee is 1% of the average Investment Advisory Account value. If your
account value increases to more than $1 million, then the fee on the amount above $1 million will be
0.75%. There are additional details in the Investment Advisory Agreement. You should review that
agreement carefully and let us know if you have any questions.
Drafting Notes: If the language above does not accurately describe how your firm is compensated, then modify the
language to provide an accurate description.
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Thompson Financial Firm
Bianca Thompson, CFP® 5678 J Street, NW Washington, DC 20008 If
your firm calculates the advisory fee differently, then modify the language above to describe how your advisory fee
is calculated.
If your firm aggregates accounts, such as family accounts, when calculating breakpoints, then you should modify
the language above.
If your firm uses a term other than “advisory fee,” then change the language in the bullet above to use your firm’s
term.
If the fee is paid on a schedule other than quarterly, then change the language to reflect the specific payment
schedule.
If your firm charges hourly, then state the hourly fee and the hourly increments in which your firm bills. If different
members of the firm bill at different hourly rates, then list the rate of each person who may provide services to the
client.
If your firm bills a flat one-time or annual fee, then state the specific fee and the time period that it covers. For
example: “You will be charged a $5,000 annual fee through December 31, 2022, payable in quarterly payments of
$1,250 beginning March 31, 2022.”
If you invest in mutual funds and exchange-traded funds (ETFs), then you will pay fees and expenses to
third parties. In addition to the advisory fee you pay us, these products have operating expenses and
ongoing fees. Mutual fund and ETF fees and expenses can include investment management fees and
shareholder service fees.
You will pay fees and expenses to the firm that holds (maintains custody of) your assets.
Drafting Notes: If there are other ways that the client may pay fees and expenses to third parties, then add
bullets to describe those fees and expenses.
You will pay fees and expenses whether you make or lose money on your investments. Fees and expenses will
reduce the amount you earn on your investments.
HOW WE (THE FIRM AND I) WILL BE PAID
You pay my firm an advisory fee. I am paid a salary plus a part of the advisory fees that clients pay my firm. You will
find more information about payments to me and my firm in my firm’s Form CRS, Form ADV, and Investment
Advisory Agreement.
Drafting Notes: Confirm that the document titles in the last sentence above match the titles on the documents you
gave your client. If they differ, then, change the titles in this letter to match those on your documents. If you gave
your client other documents that describe the information addressed in this letter, then you should add those titles
to the list above.
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Thompson Financial Firm
Bianca Thompson, CFP® 5678 J Street, NW Washington, DC 20008 If
your firm uses a term other than “advisory fee,” then change the language in the sentences above to use your firm’s
term.
If you are paid in different or additional ways (including if you are not paid a salary), then replace the language in
the second sentence with language that describes how you are paid.
If there are ways that you are paid by firms that are not related to your firm, then describe them here.
If you or your firm receives any sales-related compensation or a related party receives any sales-related
compensation in connection with any professional services you or your firm provides to clients, then you may not
describe your practice as fee-only.
MY MATERIAL CONFLICTS OF INTEREST
We have a conflict of interest whenever we have interests that are different from yours. Conflicts can affect the
recommendations we give you. When we have a conflict, we will tell you. You can find more information about our
conflicts of interest in my firm’s Form CRS, Form ADV, and Investment Advisory Agreement. We have policies and
procedures designed to help manage conflicts. We will always work in your best interests.
The ways you pay us create conflicts of interest. The amount we earn from working with you depends, in
part, on the amount of assets we manage for you. We have a financial incentive to recommend that you
make financial decisions that would result in more assets under our management.
If we provide other services to you in the future, there may be different conflicts . When we have a conflict of
interest, we will tell you about it.
If you are concerned about a conflict of interest and how it might affect your accounts, please talk to me about it.
Drafting Notes: These material conflicts of interest are examples. If they do not apply to your practice, then do not
include them in your letter. If you have other material conflicts of interest, then you need to disclose them here.
YOUR RESPONSIBILITIES
It is your responsibility to update the information you have given me about your personal and financial
circumstances. You will be sent account reports at least quarterly. You also can access the reports online. You
should review these documents carefully. Let me know if you want to talk about the information in these documents.
Drafting Notes: You will need to modify the Your Responsibilities section if your firm sends reports on a schedule
other than quarterly, or if another firm sends the reports, or if your firm does not send reports but makes them
available to the client online, or if your firm does not make reports available to clients online, or if your clients have
other responsibilities not described here.
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Thompson Financial Firm
Bianca Thompson, CFP® 5678 J Street, NW Washington, DC 20008
TIMING OF THE ENGAGEMENT
Our engagement will continue until one of us decides to change or end it. If you decide to change or end the
engagement, you just need to tell us. We can do the same, but we will tell you in writing.
Drafting Notes: If your firm has a specific policy about when and how notice must be given to end the engagement,
then it should be stated here.
YOUR PERSONAL INFORMATION
My firm has adopted and implemented policies about protecting and sharing your non-public personal information.
We have given you our privacy policy.
Drafting Notes: If you enclosed or attached the privacy policy with this communication or will provide it at another
time, then change the language in the last sentence.
PUBLIC DISCIPLINARY AND BANKRUPTCY HISTORY
In 2017, the Securities and Exchange Commission (“SEC”) and the Certified Financial Planner Board of Standards,
Inc. sanctioned me for failing to maintain required records. You will find more information at
https://adviserinfo.sec.gov/ and cfp.net/verify.
Drafting Notes: If you do not have public disciplinary or bankruptcy history, then you may choose whether to include
this section.
THANK YOU FOR WORKING WITH US
Thank you for choosing us to work with you. We look forward to getting to know you better. You may reach me at
[email protected] or 202-379-2200.
Sincerely,
Bianca Thompson, CFP©
