A. Schmidt Advisory Services, Inc. dba Catalyst Wealth Management
Schmidt Advisory Services, Inc. (the “Firm,” “we” or “us”) is organized as an Illinois corporation. The Firm was previously
registered as a state investment adviser from 1993 until 2008 (under the CRD No. 114576), is currently registered under
the CRD No. 283728, and is principally owned by Sanford Schmidt, who is also the Firm’s President. In May 2019, we
began doing business as Catalyst Wealth Management.
B. Advisory Services Offered
We primarily offer portfolio asset management services, which include recommendation of third-party separate account
managers. We also provide financial and estate planning services as well as private fund recommendations to
appropriately qualified clients. In this Brochure, we refer to our portfolio asset management, financial and estate
planning services and private fund recommendations collectively as our “Advisory Services,” and the clients to whom
we provide them as our “Advisory Clients.” In addition to providing our Advisory Services to our Advisory Clients, we
also anticipate sponsoring and managing one or more private funds (“Private Funds”).
B.1. Portfolio Asset Management Services—Advisory Clients
Our discretionary asset management services are predicated on the Advisory Client's investment objectives, goals,
tolerance for risk, and other personal and financial circumstances. We will analyze each Advisory Client's current
investments, investment objectives, goals, age, time horizon, financial circumstances, investment experience, investment
restrictions and limitations, and risk tolerance and implement a portfolio consistent with such investment objectives,
goals, risk tolerance and related financial circumstances. Our objective is to review the Advisory Client’s tax, financial,
and estate planning objectives and goals in connection with the client’s investment objectives, goals, tolerance for risk,
and other personal and financial circumstances and make appropriate recommendations and implementation decisions.
We may engage third-party service providers to assist with the tax and estate planning portion of the services provided
to Advisory Clients. In addition, we may utilize third-party software to analyze individual security holdings and separate
account managers utilized within an Advisory Client’s portfolio.
Our investment advisory services take into account an Advisory Client's personal financial circumstances, and our
engagement will include, as appropriate, the following:
Providing assistance in reviewing the Advisory Client's current investment portfolio against the client's
personal and financial circumstances disclosed to us in response to a questionnaire and/or in discussions with
the client and reviewed in meetings.
Analyzing the client's financial circumstances, investment holdings and strategy, and goals.
Providing assistance in identifying a targeted asset allocation and portfolio design.
Retaining independent investment managers.
Reporting to the Advisory Client on a quarterly basis or at some other interval agreed upon with the client,
information on contributions and withdrawals in the client's investment portfolio, and the performance of the
portfolio measured against appropriate benchmarks (including benchmarks selected by the client).
Proposing changes in the Advisory Client's investment portfolio in consideration of changes in the client's
personal circumstances, investment objectives and tolerance for risk, the performance record of any of the
client's investments, and/or the performance of any investment manager retained by the client.
If the Advisory Client’s portfolio and personal circumstances, investment objectives, and tolerance for risk make
such advice appropriate, providing recommendations into alternative investments such as real estate, private
equity, and hedge fund investments. This would be discussed and agreed upon with the Advisory Client prior
to incorporating any such investments.
In addition to providing us with information regarding their personal financial circumstances, investment objectives and
tolerance for risk, Advisory Clients must provide us with any reasonable investment restrictions that should be imposed
on the management of their portfolio, and to promptly notify us in writing of any changes in such restrictions or in the
Advisory Client's personal financial circumstances, investment objectives, goals and tolerance for risk. We remind clients
of their obligation to inform us of any such changes or any restrictions that should be imposed on the management of
their account. We also contact Advisory Clients at least annually to determine whether there have been any changes in
their personal financial circumstances, investment objectives and tolerance for risk.
B.2. Private Alternative Investments—Advisory Clients
We also provide initial and ongoing diligence, assistance with selection, and ongoing reporting and monitoring of
Advisory Clients’ separately selected private alternative investments (“PAIs”). We will have no authority to select PAIs
for Advisory Clients or take any action respecting the PAIs. Upon client request, we will assist
with implementing PAI
investment decisions.
While we do sponsor and manage certain Private Funds described below, we do not sponsor PAIs, nor do we offer or
control any PAI. It is the client’s responsibility to carefully investigate any potential PAI investment they make, including
by assessing the risks, fees, expenses, and any conflicts of interest associated with the PAI. Further, most PAIs have
severe restrictions on transferability and therefore investors may be required to remain invested in any given PAI for
many years.
B.3. Financial & Estate Planning Services
The Advisory Client will receive a written or oral report (depending on the client’s preference) that provides the client
with a detailed financial plan designed to help achieve the client’s stated financial goals and objectives. Based on the
client’s needs, financial planning services generally include the following:
Preparation of a consolidated assessment of financial condition, which may include:
• Annual budgeting
• Cash flow monitoring
• Account reconciliations
• Personal financial statement preparation
• Debt management
Establishment of objectives over relevant timeframes, which may include:
• Retirement objectives
• Philanthropy
• Estate planning
• Wealth transition
• Other related issues
Preparation of a recommended asset allocation that serves to diversify the client's portfolio among different
categories of investments, such as:
• Small, medium, and large capitalization securities
• Corporate and government fixed income (short-, intermediate-, and long-term maturities)
• Emerging market securities (i.e., foreign issuers)
• Such other asset categories that are suitable in light of the client's investment goals, objectives, and risk
tolerance
Preparation of a retirement plan that serves to identify whether the Advisory Client is saving enough and
investing in a way that meets retirement objectives in light of the client's financial circumstances and risk
tolerance.
Risk analysis and preparation of an insurance plan to meet the needs of the Advisory Client, taking into account
their family, business, and other financial objectives.
Preparation of an estate plan to ensure that wealth transition, tax, and related issues are met in accordance
with the client's wishes. In many instances, an outside attorney will need to be hired to handle specific legal
issues that arise in the formation and implementation of an estate plan, which may include the following topics:
• Estate planning
• Estate administration
• Charitable/philanthropic planning
• Advice on wills and trust agreements
• Business transition planning
• Retirement and distribution planning
We gather information through in-depth personal interviews and questionnaires. Information gathered includes the
client's current financial status, investment objectives, future goals, and attitudes toward risk. Related documents
supplied by the client are carefully reviewed, and a report is prepared covering one or more of the above-mentioned
topics as directed by the client.
B.4. Private Funds
Among other services explained in this Brochure, we may from time to time develop, offer and manage Private Funds
that have varying investment objectives and strategies, and those strategies may differ considerably from those we
recommend in our services described above. Each Private Fund’s objectives, fees, risks and conflicts of interest are
discussed in the fund’s offering memorandum (“Memorandum”), and its terms set by its governing documents (such
as a limited partnership agreement or operating agreement, the “Governing Documents,” together with the
Memorandum, the “Offering Documents”).
Private Funds are expected to be only suitable for investors with no or a limited need for liquidity in their investment,
for whom an investment in the Private Fund does not constitute a complete investment program, and for those who
fully understand the Private Fund’s risks, fees and conflicts of interest. Because Private Fund investments are often
illiquid or conditionally liquid, and involve additional degrees of risk, they will only be recommended to accredited
investors when the recommendation and implementation are consistent with the client’s stated investment objectives,
tolerance for risk, liquidity and suitability.
C. Client-Tailored Services & Client-Imposed Restrictions
Each Advisory Client’s account will be managed on the basis of the client’s financial situation and investment objectives
and in accordance with any reasonable restrictions imposed by the client on the management of the account—for
example, restricting the type or amount of security to be purchased in the portfolio.
D. Wrap Fee Programs
Catalyst Wealth does not participate in wrap fee programs, where certain brokerage commissions and transaction costs
are included in the asset-based fee charged to the client.
E. Advisory Client Assets Under Management
As of December 31, 2023, Catalyst Wealth had $71,711,751 in discretionary assets and $0 in non-discretionary assets
under management.