A. Firm Information
HFG Advisors, Inc. d/b/a Hackman Financial Group (“Hackman Financial Group” or the “Advisor”) is a registered
investment advisor with the U.S. Securities and Exchange Commission (“SEC”). The Advisor is organized as a
Corporation under the laws of the State of Ohio. Hackman Financial Group was founded in July 2016 and is
owned and operated by Michael R. Hackman (Founder and President). This Disclosure Brochure provides
information regarding the qualifications, business practices, and the advisory services provided by Hackman
Financial Group.
B. Advisory Services Offered
Hackman Financial Group offers investment advisory services to individuals, high net worth individuals, trusts,
estates, businesses, charitable organizations and retirement plans (each referred to as a “Client”).
The Advisor serves as a fiduciary to Clients, as defined under the applicable laws and regulations. As a fiduciary,
the Advisor upholds a duty of loyalty, fairness and good faith towards each Client and seeks to mitigate potential
conflicts of interest. Hackman Financial Group’s fiduciary commitment is further described in the Advisor’s Code
of Ethics. For more information regarding the Code of Ethics, please see Item 11 – Code of Ethics, Participation
or Interest in Client Transactions and Personal Trading.
Investment Management Services
Hackman Financial Group provides customized investment advisory solutions for its Clients. This is achieved
through continuous personal Client contact and interaction while providing discretionary investment management
and related advisory services. Hackman Financial Group works closely with each Client to identify their
investment goals and objectives as well as risk tolerance and financial situation in order to create a portfolio
strategy. Hackman Financial Group will then construct a portfolio, consisting of diversified mutual funds,
exchange-traded funds (“ETFs”), equity securities, fixed income securities, and real estate investment trusts
(“REITs”). The Advisor may also utilize other types of investments to meet the needs of certain Clients. Hackman
Financial Group may retain certain legacy investments based on portfolio fit and/or tax considerations.
Hackman Financial Group’ investment approach is primarily long-term focused, but the Advisor may buy, sell or
re-allocate positions that have been held for less than one year to meet the objectives of the Client or due to
market conditions. Hackman Financial Group will construct, implement and monitor the portfolio to ensure it
meets the goals, objectives, circumstances, and risk tolerance agreed to by the Client. Each Client will have the
opportunity to place reasonable restrictions on the types of investments to be held in their respective portfolio,
subject to acceptance by the Advisor.
Hackman Financial Group evaluates and selects investments for inclusion in Client portfolios only after applying
its internal due diligence process. Hackman Financial Group may recommend, on occasion, redistributing
investment allocations to diversify the portfolio. Hackman Financial Group may recommend specific positions to
increase sector or asset class weightings. The Advisor may recommend employing cash positions as a possible
hedge against market movement. Hackman Financial Group may recommend selling positions for reasons that
include, but are not limited to, harvesting capital gains or losses, business or sector risk exposure to a specific
security or class of securities, overvaluation or overweighting of the position[s] in the portfolio, change in risk
tolerance of the Client, generating cash to meet Client needs, or any risk deemed unacceptable for the Client’s
risk tolerance.
At no time will Hackman Financial Group accept or maintain custody of a Client’s funds or securities, except for
the limited authority as outlined in Item 15 – Custody. All Client assets will be managed within their designated
account[s] at the Custodian, pursuant to the terms of the advisory agreement. Please see Item 12 – Brokerage
Practices.
Retirement Accounts – When the Advisor provides investment advice to Clients regarding ERISA retirement
accounts or individual retirement accounts (“IRAs”), the Advisor is a fiduciary within the meaning of Title I of the
Employee Retirement Income Security Act (“ERISA”) and/or the Internal Revenue Code (“IRC”), as applicable,
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which are laws governing retirement accounts. When deemed to be in the Client’s best interest, the Advisor will
provide investment advice to a Client regarding a distribution from an ERISA retirement account or to roll over
the assets to an IRA, or recommend a similar transaction including rollovers from one ERISA sponsored Plan to
another, one IRA to another IRA, or from one type of account to another account (e.g. commission-based
account to fee-based account). Such a recommendation creates a conflict of interest if the Advisor will earn a
new (or increase its current) advisory fee as a result of the transaction. No client is under any obligation to roll
over a retirement account to an account managed by the Advisor.
Use of Independent Managers
Hackman Financial Group may recommend that Clients utilize one or more unaffiliated money managers or
investment platforms (collectively “Independent Managers”) for all or a portion of Client’s investment portfolio.
Independent Managers will be sourced directly or accessed through an investment management platform.
Hackman Financial Group serves as the Client’s primary advisor and relationship manager. However, the
Independent Manager will assume discretionary authority for the day-to-day investment management of those
assets placed in their control. Hackman Financial Group will assist and advise the Client in establishing
investment objectives for their account[s], the selection of the Independent Manager, and defining any
restrictions on the account[s]. Hackman Financial Group will continue to provide oversight of the Client’s
account[s] and ongoing monitoring of the activities of the Independent Manager. The Independent Manager will
implement the selected investment strategies based on their investment mandates. The Client may be able to
impose reasonable investment restrictions on these accounts, subject to the acceptance of the Independent
Manager[s]. The Client will be provided with the Form ADV Part 2A (or a brochure that makes the appropriate
disclosures) of the Independent Manager[s].
Financial Planning Services
Hackman Financial Group will typically provide a variety of financial planning and consulting services to Clients,
either as a component of investment management services or pursuant to a written financial planning agreement.
Services are offered in several areas of a Client’s financial situation, depending on their goals and objectives.
As part of the Advisor’s financial planning services, Hackman Financial Group may provide personal financial
planning services tailored to the individual needs of each Client. A particular Client’s financial plan will include the
relevant types of planning specific to their needs and objectives such as:
•
Retirement – planning an investment strategy with the objective of providing inflation-adjusted income for
life.
•
College / Education – planning to pay the future college / education expenses of a child or grandchild.
• Major Purchase – Evaluation of the pros and cons of home ownership verse renting as well as buying or
leasing a car, for example.
•
Divorce – planning for the financial impact of divorce such as change in income, retirement benefits and
tax considerations.
•
Insurance Needs – planning for the financial needs of survivors to satisfy such financial obligations as
housing, dependent child care and spousal arrangements as well as education.
•
Final Expenses – planning to leave assets to cover final expenses such as funeral, debts and potential
business continuity.
•
Estate Planning – planning that focuses on the most efficient and tax friendly option to pass on an estate
to a spouse, other family members or a charity.
•
Cash Flow/ Budget Planning – planning to manage expenses against current and projected income.
• Wealth Accumulation – planning to build wealth within a portfolio that takes into consideration risk
tolerance and time horizon.
•
Business Succession – planning for the continuation of a business in a smooth a transition as possible
with the use of buy-sell agreements, key-man insurance and engaging independent legal counsel as
needed.
•
Tax Planning
– planning a tax efficient investment portfolio to maximize deductions and off-setting
losses.
•
Investment Planning – planning an investment strategy consistent with particular objectives, time
horizons and risk tolerances.
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The services take into account information collected from the Client such as financial status, investment
objectives and tax status, among other data. Fees for such services are negotiable and detailed in the Client
agreement.
The financial plan may include generic recommendations as to general types of investment products or specific
securities which may be appropriate for the Client to purchase given his/her financial situation and objectives.
For example, recommendations may be made that the Client start or revise their investment programs,
commence or alter retirement savings, establish education savings and/or charitable giving programs. Hackman
Financial Group may also refer Clients to an accountant, attorney or another specialist, as appropriate for their
unique situation. For certain financial planning engagements, the Advisor will provide a written summary of
Client’s financial situation, observations, and recommendations. For consulting or ad-hoc engagements, the
Advisor may not provide a written summary. Plans or consultations are typically completed within six months of
contract date, assuming all information and documents requested are provided promptly.
Financial planning and consulting recommendations pose a conflict between the interests of the Advisor and the
interests of the Client. For example, the Advisor has an incentive to recommend that Clients engage the Advisor
for investment management services or to increase the level of investment assets with the Advisor, as it would
increase the amount of advisory fees paid to the Advisor or additional compensation to its Advisory Person[s].
Clients are not obligated to implement any recommendations made by the Advisor or maintain an ongoing
relationship with the Advisor. If the Client desires to purchase securities or advisory services in order to
implement his/her financial plan, the Advisor may implement these recommendations internally or suggest that
the Client engage its Advisory Persons in their separate capacity as registered representatives of LPL Financial.
Please see Item 5.E below and Item 10 – Other Financial Industry Activities and Affiliations.
Retirement Plan Advisory Services
Hackman Financial Group provides retirement plan advisory services on behalf of retirement plans (each a
“Plan”) and the company (the “Plan Sponsor”). The Advisor’s retirement plan advisory services are designed to
assist the Plan Sponsor in meeting its fiduciary obligations to the Plan and its Plan Participants. Each
engagement is customized to the needs of the Plan and Plan Sponsor. Services generally include:
• Assistance in the preparation or review of an investment policy statement (“IPS”) for the Plan based
upon consultation with Plan Sponsor to ascertain Plan’s investment objectives and constraints.
• Acting as a liaison between the Plan and service providers, product sponsors or vendors.
• Ongoing monitoring of investment manager(s) or investments in relation to the criteria specified in the
Plan’s IPS or other written guidelines provided by the Plan Sponsor.
• Preparation of reports describing the performance of Plan investment manager(s) or investments, as well
as comparing the performance to benchmarks.
• Ongoing recommendations, for consideration and selection by Plan Sponsor, about specific investments
to be held by the Plan or, in the case of a participant-directed defined contribution plan, to be made
available as investment options under the Plan.
• Education or training for the members of the Plan investment committee with regard to various matters,
including plan features, retirement readiness matters, service on the committee, and fiduciary
responsibilities.
• Assistance in enrolling Plan Participants, including conducting an agreed upon number of enrollment
meetings. As part of such meetings, the Advisor may provide Plan Participants with information about the
Plan, which may include information on the benefits of Plan participation, the benefits of increasing Plan
contributions, the impact of pre-retirement withdrawals on retirement income, the terms of the Plan and
the operation of the Plan.
If the Plan makes available publicly traded employer stock (“company stock”) as an investment option under the
Plan, the Advisor does not provide investment advice regarding company stock and are not responsible for the
decision to offer company stock as an investment option. In addition, if Plan Participants invest the assets in their
accounts through individual brokerage accounts, a mutual fund window, or other similar arrangement, or may
obtain participant loans, the Advisor does not provide any individualized advice or recommendations to the Plan
Participants regarding these decisions. Furthermore the Advisor does not provide individualized investment
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advice to Plan Participants regarding their Plan assets. These services are provided by Hackman Financial
Group serving in the capacity as a fiduciary under the Employee Retirement Income Security Act of 1974, as
amended (“ERISA”). In accordance with ERISA Section 408(b)(2), the Plan Sponsor is provided with a written
description of Hackman Financial Group’s fiduciary status, the specific services to be rendered and all direct and
indirect compensation the Advisor reasonably expects under the engagement.
C. Client Account Management
Prior to engaging Hackman Financial Group to provide investment advisory services, each Client is
required to enter into one or more agreements with the Advisor that define the terms, conditions,
authority and responsibilities of the Advisor and the Client. These services may include:
• Establishing an Investment Strategy – Hackman Financial Group, in connection with the Client, will
develop a strategy that seeks to achieve the Client’s investment goals and objectives.
• Asset Allocation – Hackman Financial Group will develop a strategic asset allocation that is targeted to
meet the investment objectives, time horizon, financial situation and tolerance for risk for each Client.
• Portfolio Construction – Hackman Financial Group will develop a portfolio for the Client that is intended to
meet the stated goals and objectives of the Client.
• Investment Management and Supervision – Hackman Financial Group will provide investment
management and ongoing oversight of the Client’s investment portfolio.
D. Wrap Fee Programs
Hackman Financial Group generally includes securities transaction fees together with its investment advisory
fees. Including these fees into a single asset-based fee is considered a “Wrap Fee Program”. The Advisor
customizes its investment management services for its Clients. The Advisor sponsors the Hackman Financial
Group’s Wrap Fee Program solely as a supplemental disclosure regarding the combination of fees. The Advisor
primarily recommends that Clients engage the Advisor under a Wrap Fee Program, to provide an overall
inclusive service. The Advisor does not charge a higher fee for Clients engaged under the Wrap Fee Program.
Please see Appendix 1 – Wrap Fee Program Brochure, which is included as a supplement to this Disclosure
Brochure.
The net advisory fees paid to the Advisor may vary depending upon the amount of trading in a Client's account[s]
and the use of no transaction fee (“NTF”) mutual funds and ETFs. This creates a conflict of interest as the
Advisor has a financial incentive to limit transactions or to select investments with NTF. The Advisor seeks to
mitigate this conflict by requiring that Advisory Persons acknowledge their fiduciary duty to place Client interests
ahead of the Advisor and to provide the Client with full and fair disclosure of the overall fees associated with their
account[s]. Further, the Chief Compliance Officer reviews Client accounts periodically to evaluate the level of
trading and underlying investments, and to validate that a Wrap Fee Program remains in the Client’s best
interest.
E. Assets Under Management
As of December 31, 2022, Hackman Financial Group manages approximately $234,810,784 in Client assets, all
of which are managed on a discretionary basis. Clients may request more current information at any time by
contacting the Advisor.