Item 1: Cover Page
Marathon Wealth Management LLC
7560 NE 28th Place
Medina, Washington 98039
Form ADV Part 2A – Firm Brochure
(425) 890-5081
Dated March 3, 2023
This Brochure provides information about the qualifications and business practices of Marathon Wealth Management LLC, “MWM”. If you have any questions about the contents of this Brochure, please contact us at (425) 890-5081. The information in this Brochure has not been approved or verified by the United States Securities and Exchange Commission or by any state securities authority.
Marathon Wealth Management LLC is registered as an Investment Adviser with the State of Washington. Registration of an Investment Adviser does not imply any level of skill or training.
Additional information about MWM is available on the SEC’s website at www.adviserinfo.sec.gov, which can be found using the firm’s identification number, 309337.
Item 2: Material Changes
The last annual update of this Brochure was filed on March 10, 2022. Since then, the following changes have been made:
• June 1, 2022 - MWM updated their hourly fee from $195/hour to $250/hour
• November 28, 2022-MWM updated AUM fee schedule- Outlined in Item 5
From time to time, we may amend this Brochure to reflect changes in our business practices, changes in regulations, and routine annual updates as required by securities regulators. Either this complete Brochure or a Summary of Material Changes shall be provided to each Client annually and if a material change occurs in the business practices of Marathon Wealth Management LLC.
Item 3: Table of Contents
Contents
Item 1: Cover Page 1
Item 2: Material Changes 2
Item 3: Table of Contents 3
Item 4: Advisory Business 4
Description of Advisory Firm 4
Types of Advisory Services 5
Wrap Fee Programs 7
Item 5: Fees and Compensation 7
Investment Management Services 7
Project-Based Hourly Financial Planning 8
Other Types of Fees and Expenses 9
Item 6: Performance-Based Fees and Side-By-Side Management 9
Item 7: Types of Clients 10
Item 8: Methods of Analysis, Investment Strategies and Risk of Loss 10
Methods of Analysis 10
Investment Strategies 11
Material Risks Involved 11
Risks Associated with Securities 12
Item 9: Disciplinary Information 13
Item 10: Other Financial Industry Activities and Affiliations 14
Item 11: Code of Ethics, Participation or Interest in Client Transactions and Personal Trading 14
Code of Ethics Description 14
Investment Recommendations Involving a Material Financial Interest and Conflicts of Interest 15
Advisory Firm Purchase of Same Securities Recommended to Clients and Conflicts of Interest 15
Trading Securities At/Around the Same Time as Client’s Securities 15
Item 12: Brokerage Practices 16
Factors Used to Select Custodians and/or Broker-Dealers 16
The Custodian and Brokers We Use (TD Ameritrade) 16
Aggregating (Block) Trading for Multiple Client Accounts 16
Item 13: Review of Accounts 17
Item 14: Client Referrals and Other Compensation 17
Item 15: Custody 18
Item 16: Investment Discretion 18
Item 17: Voting Client Securities 19
Item 18: Financial Information 19
Item 19: Requirements for State-Registered Advisers 19
Form ADV Part 2B – Brochure Supplement 21
Item 4: Advisory Business
Description of Advisory Firm
Marathon Wealth Management LLC is an Investment Advisory firm providing investment advisory services to individuals, high net worth individuals, trusts and estates. We were founded in May 2020 and became registered with the State of Washington as a registered Investment Advisory firm in August of 2020. Melinda Satterlee is the principal owner of MWM. MWM currently reports $8,154,422 discretionary assets under management and $0 non-discretionary assets under management. Assets Under Management were calculated as of December 31, 2022.
Types of Advisory Services
Investment Management Services
We are in the business of managing individually tailored investment portfolios. Our firm provides continuous advice to a Client regarding the investment of Client funds based on the individual needs of the Client. Through personal discussions in which goals and objectives based on a Client's particular circumstances are established, we develop a Client's personal investment policy or an investment plan with an asset allocation target and create and manage a portfolio based on that policy and allocation targets. We will also review and discuss a Client’s prior investment history, as well as family composition and background. In addition, we will provide Ongoing Financial Planning services.
Account supervision is guided by the stated objectives of the Client (e.g., maximum capital appreciation, growth, income, or growth and income), as well as tax considerations. Clients may impose reasonable restrictions on investing in certain securities, types of securities, or industry sectors. Fees pertaining to this service are outlined in Item 5 of this brochure.
Hourly Financial Planning Services
We provide three financial planning services. 1: A three-month comprehensive planning engagement for a flat fee, 2: A focused financial planning service and 3: Ongoing Financial Planning for a monthly fee. Each planning service may provide advice on topics such as retirement funding, risk management, education funding, cash flow, debt management, employee benefit optimization, and estate and incapacity planning.
This financial planning service includes gathering of information regarding the client’s current and historical status in the areas of net worth, income, expenses, taxes, investments, retirement plans and insurance. Next, an evaluation of a Client's current and future financial state by using currently known variables to predict future cash flows, asset values, and withdrawal plans will be performed. The key defining aspect of financial planning is that through the financial planning process, all questions, information, and analysis will be considered as they affect and are affected by the entire financial and life situation of the Client. Clients purchasing this service will receive a written or an electronic report, providing the Client with a detailed financial plan designed to achieve his or her stated financial goals and objectives.
In general, the financial plan will address any or all of the following areas of concern. The Client and advisor will work together to select specific areas to cover. These areas may include, but are not limited to, the following:
Cash Flow and Debt Management: We will conduct a review of your income and expenses to determine your current surplus or deficit along with advice on prioritizing how any surplus should be used or how to reduce expenses if they exceed your income. Advice may also be provided on which debts to pay off first based on factors such as the interest rate of the debt and any income tax ramifications. We may also recommend what we believe to be an appropriate cash reserve that should be considered for emergencies and other financial goals, along with a review of accounts (such as money market funds) for such reserves, plus strategies to save desired amounts.
Education Funding: Includes projecting the amount that will be needed to achieve college or other post education funding goals, along with advice on ways for you to save the desired amount. Recommendations as to savings strategies are included, and, if needed, we will review your financial picture as it relates to eligibility for financial aid or the best way to contribute to grandchildren (if appropriate).
Employee Benefits Optimization: We will provide review and analysis as to whether you, as an employee, are taking the maximum advantage possible of your employee benefits. If you are a business owner, we will consider and/or recommend the various benefit programs that can be structured to meet both business and personal retirement goals.
Estate Planning: This usually includes an analysis of your exposure to estate taxes and your current estate plan, which may include whether you have a will, powers of attorney, trusts, and other related documents. Our advice also typically includes ways for you to minimize or avoid future estate taxes by implementing appropriate estate planning strategies such as the use of applicable trusts. We always recommend that you consult with a qualified attorney when you initiate, update, or complete estate planning activities. We may provide you with contact information for attorneys who specialize in estate planning when you wish to hire an attorney for such purposes. From time-to-time, we will participate in meetings or phone calls between you and your attorney with your approval or request.
Financial Goals: We will help Clients identify financial goals and develop a plan to reach them. We will identify what you plan to accomplish, what resources you will need to make it happen, how much time you will need to reach the goal, and how much you should budget for your goal.
Investment Analysis: This may involve developing an asset allocation strategy to meet Clients’ financial goals and risk tolerance, providing information on investment vehicles and strategies, reviewing employee stock options, as well as assisting you in establishing your own investment account at a selected broker/dealer or custodian. The strategies and types of investments we may recommend are further discussed in Item 8 of this brochure.
Investing During Retirement: If you are near retirement or already retired, advice will be given on appropriate distribution strategies to minimize the likelihood of running out of money or having to adversely alter spending during your retirement years
Retirement Funding: Our retirement planning services typically include projections of your likelihood of achieving your financial goals, typically focusing on financial independence as the primary objective. For situations where projections show less than the desired results, we may make recommendations, including those that may impact the original projections by adjusting certain variables (e.g., working longer, saving more, spending less, taking more risk with investments).
Risk Management: A risk management review includes an analysis of your exposure to major risks that could have a significant adverse impact on your financial picture, such as premature death, disability, property and casualty losses, or the need for long‐term care planning. Advice may be provided on ways to minimize such risks and about weighing the costs of purchasing insurance versus the benefits of doing so and, likewise, the potential cost of not purchasing insurance (“self‐insuring”).
Tax Planning Strategies: Advice may include ways to minimize current and future income taxes as a part of your overall financial planning picture. For example, we may make recommendations on which type of account(s) or specific investments should be owned based in part on their “tax efficiency,” with consideration that there is always a possibility of future changes to federal, state, or local tax laws, and rates that may affect your situation.
Our financial plans do not include preparation of any kind of income tax, gift, or estate tax returns or preparation of any legal documents, including wills and trusts.
Educational Seminars
Seminars are offered to organizations and the public on a variety of financial topics. The fee range is based on the content, amount of research conducted, the number of hours of preparation needed, and the number of attendees.
Client Tailored Services and Client Imposed Restrictions
We offer the same suite of services to all of our Clients. However, specific Client financial plans and their implementation are dependent upon the Client Investment Policy Statement which outlines each Client’s current situation (income, tax levels, and risk tolerance levels) and is used to construct a Client specific plan to aid in the selection of a portfolio that matches restrictions, needs, and targets.
Clients are able to specify, within reason, any limitations they would like to place on discretionary authority as it pertains to individual securities and/or sectors that will be traded in their account, by notating these items on the executed advisory agreement.
Wrap Fee Programs
We do not participate in wrap fee programs.
Item 5: Fees and Compensation
Please note, unless a Client has received the firm’s Disclosure Brochure at least 48 hours prior to signing the investment advisory contract, the investment advisory contract may be terminated by the Client within five (5) business days of signing the contract without incurring any advisory fees or penalties. How we are paid depends on the type of advisory service we are performing. Please review the fee and compensation information below.
Investment Management Services
The annual fees are negotiable and are prorated and paid in arrears on a quarterly basis. Our standard advisory fee is based on the market value of the assets under management and is calculated as follows: The advisory fee is based on an annual rate of 1% with a cap at certain thresholds. This fee will not exceed the annual advisory fee at each tier. Your investment tier will be based on the account value determined at the start of the investment management relationship and remain the same until re-calculated annually on Dec. 31st. No increase in the annual fee shall be effective without agreement from the Client by signing a new agreement or amendment to their current advisory agreement. In all instances, the Adviser will send the client a written invoice, including the fee, the formula used to calculate the fee, the fee calculation itself, the time period covered by the fee, and, if applicable, the amount of assets under management on which the fee was based. Also, the Adviser will include the name of the custodian(s) on your fee invoice. The Adviser will send these to the client concurrent with the request for payment or payment of the Adviser’s advisory fees. We urge the client to compare this information with the fees listed in the account statement
Advisory fees are directly debited from Client accounts, or the Client may choose to pay by check or wire transfer. Accounts initiated or terminated during a calendar quarter will be charged a prorated fee based upon the days the account was open during the billing period. An account may be terminated with written notice or by phone or email at least 30 calendar days in advance. Since fees are paid in arrears, no refund will be needed upon termination of the account.
In computing the market value of any investment contained in the account, each security listed on any national securities exchange shall be valued at the last quoted sale price on the valuation date on the principal exchange on which such security is traded. Any other security or asset shall be valued in a manner that reflects it’s fair market value and that is consistent with the Adviser’s fiduciary duty. For securities not listed on a public exchange, we will contact any associated vendors and custodians to work with them on obtaining the necessary information in order to provide an evaluation for the security. Clients may contact MWM if they are concerned with valuation for assets not listed on a public exchange.
Project-Based Hourly Financial Planning
Comprehensive Financial Plan: The fee for development of a comprehensive financial plan will range between $3750.00 to $5000.00 depending on the complexity of the Client’s financial situation. (Fee based on 15-20 hours of work @ $250.00/hr.) $500.00 of the fee will be due at the beginning of the engagement and the remainder is due upon delivery of the financial plan. This work will commence immediately after the $500.00 fee is paid, and the length of time required to complete and deliver the plan is dependent on several factors including the needs of the client, the client’s ability to provide any necessary information and documentation, as well as the complexity of their financial situation. At no time do we require prepayment of fees 6 or more months in advance of delivering the requested services. MWM will schedule a follow up meeting to serve as a check in for the implementation of the financial plan. Following this meeting, once the plan has been delivered, clients may choose to continue the relationship by engaging using our Ongoing Financial Planning Service. Fees for this service may be paid by credit card or check through Advicepay. In the event of early termination any prepaid but unearned fees will be refunded to the Client and any completed deliverables of the project will be provided to the Client and no further fees will be charged.
Focused Financial Planning: We will review, analyze, and recommend an action plan on one or two top financial planning concerns such as: cash flow management, tax planning, retirement planning, risk management, investment analysis, estate planning, or employee benefit optimization. $250hr. (billed in 15 minute increments, 6 hour minimum)
Ongoing Financial Planning: Ongoing Financial Planning consists of an ongoing flat fee that is paid monthly, in arrears, at a rate between $250 and $500 per month, (1-2 hours @ $250.00/hr.), based on the Client’s financial complexity. The fee may be negotiable in certain cases at the discretion of MWM. Fees for this service may be paid by credit card or check through Advicepay. This service may be terminated by either party with 30 days’ notice. Upon termination, the fee will be prorated and any unearned fees will be refunded to the Client.
Educational Seminars
Seminars are offered to organizations and the public on a variety of financial topics. Fees range from $1000 to $2500 per seminar or $25 to $50 per participant. 50% of the fees are due prior to the engagement, and the other half is to be paid at the conclusion of the Seminar. The fee range is based on the content, amount of research conducted, the number of hours of preparation needed, and the number of attendees. In the event of inclement weather or flight cancellation, the Speaker shall make all reasonable attempts to make alternative travel arrangements to arrive in time for the presentation. If travel proves impossible, or the event is otherwise canceled, the Speaker's fee is waived, but the Client will still be responsible for reimbursement of any non-refundable travel expenses already incurred.
In the event that the Client decides to cancel or change the date of the event for any reason besides weather or similar unforeseen causes, the Client will still be responsible for reimbursement of any non-refundable travel expenses already incurred, and will provide payment for 50 % of the Speaker’s fee if the cancellation occurs within 30 days of the event. In the event that the Speaker must cancel due to health or similar unforeseen circumstances, the Speaker will make all attempts to find a reasonable alternative engagement date and will absorb any incremental additional costs for obtaining alternative travel arrangements. If an alternative date cannot be obtained, the Client will not be responsible for any travel costs already incurred by the Speaker or any portion of the Speaker’s fee.
Other Types of Fees and Expenses
Our fees are exclusive of brokerage commissions, transaction fees, and other related costs and expenses which may be incurred by the Client. Clients may incur certain charges imposed by custodians, brokers, and other third parties such as custodial fees, deferred sales charges, odd-lot differentials, transfer taxes, wire transfer, and electronic fund fees, and other fees and taxes on brokerage accounts and securities transactions. Mutual fund and exchange-traded funds also charge internal management fees, which are disclosed in a fund's prospectus. Such charges, fees, and commissions are exclusive of and in addition to our fee, and we shall not receive any portion of these commissions, fees, and costs.
Item 12 further describes the factors that we consider in selecting or recommending broker-dealers for Client’s transactions and determining the reasonableness of their compensation (e.g., commissions).
We do not accept compensation for the sale of securities or other investment products including asset-based sales charges or service fees from the sale of mutual funds.
Item 6: Performance-Based Fees and Side-By-Side Management
We do not offer performance-based fees and do not engage in side-by-side management.
Item 7: Types of Clients
We provide financial planning and portfolio management services to individuals, high net-worth individuals, trusts and estates.
We do not have a minimum account size requirement.
Item 8: Methods of Analysis, Investment Strategies and Risk of Loss
Methods of Analysis
With the approved investment policy in place, Marathon Wealth utilizes modeling techniques to determine an optimal target allocation for the client’s assets. For this process, MWM uses both asset allocation-modeling programs as well as our own analysis to develop what we believe is a meaningful plan for our Clients, including target asset class mixes. The “core”asset classes we follow and typically include in our recommended investment portfolios include the following:
• US Equity
• Non-US Equity(Developed Markets)
• Non-US Equity(Emerging Markets)
• US Fixed Income
• Public Real Estate(REITs)
• Hedge Funds (Fund of Funds)
• Real Assets
We track different categories and investment styles within each of these categories, (i.e. value, growth, small vs. large, etc.)
Fundamental analysis involves analyzing individual companies and their industry groups, such as a company’s financial statements, details regarding the company’s product line, the experience, and expertise of the company’s management, and the outlook for the company’s industry. The resulting data is used to measure the true value of the company’s stock compared to the current market value. The risk of fundamental analysis is that the information obtained may be incorrect and the analysis may not provide an accurate estimate of earnings, which may be the basis for a stock’s value. If securities prices adjust rapidly to new information, utilizing fundamental analysis may not result in favorable performance.
Cyclical analysis is a type of technical analysis that involves evaluating recurring price patterns and trends based upon business cycles. Economic/business cycles may not be predictable and may have many fluctuations between long-term expansions and contractions. The lengths of economic cycles may be difficult to predict with accuracy and therefore the risk of cyclical analysis is the difficulty in predicting economic trends and consequently the changing value of securities that would be affected by these changing trends.
Technical analysis involves analyzing past market movements and applying that analysis to the present in an attempt to recognize recurring patterns of investor behavior and potentially predict future price movement. Technical analysis does note consider the underlying financial condition of a company.
Investment Strategies
Marathon Wealth is a firm believer in risk management through portfolio diversification and harvesting strategies. MWM will seek to diversify client portfolios across a broad range of asset classes. Proper diversification minimizes or reduces the volatility and risk associated with a client's investments along with a harvesting strategy to preserve capital.
Strategic Passive Investment Management
We primarily practice strategic passive investment management. Strategic Passive investing involves building portfolios that are composed of various distinct asset classes. The asset classes are weighted in a manner to achieve the desired relationship between correlation, risk, and return. Funds that passively capture the returns of the desired asset classes are placed in the portfolio. The funds that are used to build passive portfolios are typically index mutual funds or exchange-traded funds. These asset allocations will be strategically rebalanced and harvested in accordance with the Client’s investment policy. MWM will not charge an ongoing advisory fee for unmanaged or static assets held in accounts.
Strategic Passive investment management is characterized by low portfolio expenses (i.e. the funds inside the portfolio have low internal costs), minimal trading costs (due to infrequent trading activity), and relative tax efficiency (because the funds inside the portfolio are tax efficient and turnover inside the portfolio is minimal).
Material Risks Involved
The modeling tools MWM uses to create financial plans and asset allocations for Clients rely on various assumptions, such as estimates of inflation, market risk, economic conditions, and rates of return on security asset classes. Modeling software is only a tool used to help guide MWM and the Client in developing and monitoring the plan, and we cannot guarantee that clients will achieve the results shown in the plan.
All investing strategies we offer involve risk and may result in a loss of your original investment which you should be prepared to bear. Many of these risks apply equally to stocks, bonds, commodities, and any other investment or security. Material risks associated with our investment strategies are listed below.
Business Risk: These risks are associated with a particular industry or a particular company within an industry. For example, oil drilling companies depend on finding oil and then refining it, a lengthy process, before they can generate a profit. They carry a higher risk of profitability than an electric company, which generates its income from a steady stream of customers who buy electricity no matter what the economic environment is like.
Currency Risk: Overseas Investments are subject to fluctuations in the value of the dollar against the currency of the investment’s originating country. This is also referred to as exchange rate risk.
False or Misleading Information: MWM relies on information obtained from sources believed to be reliable to make investment decisions. No guarantee can be made that these sources are indeed reliable.
Financial Risk: Excessive borrowing to finance a business’ operations increases the risk of profitability, because the company must meet the terms of its obligations in good times and bad. During periods of financial stress, the inability to meet loan obligations may result in bankruptcy and/or declining market value.
Inflation: Inflation may erode the buying power of your investment portfolio, even if the dollar value of your investments remains the same.
Interest Rate Risk: Bond (fixed income) prices generally fall when interest rates rise, and the value may fall below par value or the principal investment. The opposite is also generally true: bond prices generally rise when interest rates fall. In general, fixed income securities with longer maturities are more sensitive to these price changes. Most other investments are also sensitive to the level and direction of interest rates.
Legal or Legislative Risk: Legislative changes or Court rulings may impact the value of investments, or the securities’ claim on the issuer’s assets and finances.
Liquidity Risk: Liquidity is the ability to readily convert an investment into cash. Generally, assets are more liquid if many traders are interested in a standardized product. For example, Treasury Bills are highly liquid, while real estate properties are not.
Market Risk: Market risk involves the possibility that an investment’s current market value will fall because of a general market decline, reducing the value of the investment regardless of the operational success of the issuer’s operations or its financial condition.
Reinvestment Risk: This is the risk that future proceeds from investments may have to be reinvested at a potentially lower rate of return (i.e. interest rate). This primarily relates to fixed income securities.
Risks Associated with Securities
Apart from the general risks outlined above which apply to all types of investments, specific securities may have other risks.
Common stocks may go up and down in price quite dramatically, and in the event of an issuer’s bankruptcy or restructuring could lose all value. A slower-growth or recessionary economic environment could have an adverse effect on the price of all stocks. Securities of companies with small and medium market capitalizations are often more volatile and less liquid than investments in larger companies. Small and medium cap companies may face a greater risk of business failure, which could increase the volatility of the Client’s portfolio.
Corporate Bonds are debt securities to borrow money. Generally, issuers pay investors periodic interest and repay the amount borrowed either periodically during the life of the security and/or at maturity. Alternatively, investors can purchase other debt securities, such as zero coupon bonds, which do not pay current interest, but rather are priced at a discount from their face values and their values accrete over time to face value at maturity. The market prices of debt securities fluctuate depending on factors such as interest rates, credit quality, and maturity. In general, market prices of debt securities decline when interest rates rise and increase when interest rates fall. The longer the time to a bond’s maturity, the greater its interest rate risk.
Municipal Bonds are debt obligations generally issued to obtain funds for various public purposes, including the construction of public facilities. Municipal bonds pay a lower rate of return than most other types of bonds. However, because of a municipal bond’s tax-favored status, investors should compare the relative after-tax return to the after-tax return of other bonds, depending on the investor’s tax bracket. Investing in municipal bonds carries the same general risks as investing in bonds in general. Those risks include interest rate risk, reinvestment risk, inflation risk, market risk, call or redemption risk, credit risk, and liquidity and valuation risk.
Exchange Traded Funds prices may vary significantly from the Net Asset Value due to market conditions. Certain Exchange Traded Funds may not track underlying benchmarks as expected. ETFs are also subject to the following risks: (i) an ETF’s shares may trade at a market price that is above or below their net asset value; (ii) trading of an ETF’s shares may be halted if the listing exchange’s officials deem such action appropriate, the shares are delisted from the exchange, or the activation of market-wide “circuit breakers” (which are tied to large decreases in stock prices) halts stock trading generally. The Adviser has no control over the risks taken by the underlying funds in which the Clients invest.
Mutual Funds: When a Client invests in open-end mutual funds or ETFs, the Client indirectly bears its proportionate share of any fees and expenses payable directly by those funds. Therefore, the Client will incur higher expenses, many of which may be duplicative. In addition, the Client's overall portfolio may be affected by losses of an underlying fund and the level of risk arising from the investment practices of an underlying fund (such as the use of derivatives).
Real Estate Investment Trusts(REIT): Securities issued by real estate trusts(REITs) Primarily invest in real estate or real estate-related loans. Equity REITs own real estate properties, while mortgage REITs hold construction, development and/or long -term mortgage loans. Changes in the value of the underlying property of the trusts, the creditworthiness of the issuer, property taxes, interest rates, tax laws, and regulatory requirements, such as those relating to the environment all can affect the values and liquidity of REITs. Both types of REITs are dependent upon management skill, the cash flows generated by their holdings, the real estate market in general. and the possibility of failing to qualify for any applicable pass-through tax treatment or failing to maintain any applicable exemptive status afforded under relevant laws.
Alternative Asset Classes: Adding alternatives can enhance an overall portfolio’s risk and return characteristics. Alternatives, however, are not appropriate for all clients and portfolios. Time horizon, risk objectives, liquidity, and taxes are all factors that need to be considered. MWM recommends fund-of-fund vehicles for the majority of the alternative asset classes as they provide an additional layer of due diligence and enhance diversification, and provide access to the top funds, some of which are otherwise closed to outside investors. Hedge funds and private equities can appear opaque as there are no high-quality established databases in existence like the public sector. This makes it more difficult to assess who is doing well and, more importantly, who is doing poorly. This obscurity makes it more essential to understand the firms with whom you are doing business and affirms the importance of a solid qualitative as well as quantitative assessment. In the alternative investment area, historical information is very limited. Cryptocurrency is a volatile asset class and as such is considered an alternative asset.
Item 9: Disciplinary Information
Criminal or Civil Actions
MWM and its management have not been involved in any criminal or civil action.
Administrative Enforcement Proceedings
MWM and its management have not been involved in administrative enforcement proceedings.
Self-Regulatory Organization Enforcement Proceedings
MWM and its management have not been involved in legal or disciplinary events that are material to a Client’s or prospective Client’s evaluation of MWM or the integrity of its management.
Item 10: Other Financial Industry Activities and Affiliations
No MWM employee is registered, or has an application pending to register, as a broker-dealer or a registered representative of a broker-dealer.
No MWM employee is registered, or has an application pending to register, as a futures commission merchant, commodity pool operator or a commodity trading advisor.
MWM does not have any related parties. As a result, we do not have a relationship with any related parties.
MWM only receives compensation directly from Clients. We do not receive compensation from any outside manager.
Item 11: Code of Ethics, Participation or Interest in Client Transactions and Personal Trading
As a fiduciary, our firm and its associates owe our clients a fiduciary duty to put the client’s interest first which includes, but is not limited to, a duty of care, loyalty, obedience, and utmost good faith. Our Clients entrust us with their funds and personal information, which in turn places a high standard on our conduct and integrity. Our fiduciary duty is a core aspect of our Code of Ethics and represents the expected basis of all of our dealings. The firm also accepts the obligation not only to comply with the mandates and requirements of all applicable laws and regulations but also to take responsibility to act in an ethical and professionally responsible manner in all professional services and activities.
Code of Ethics Description
This code does not attempt to identify all possible conflicts of interest, and literal compliance with each of its specific provisions will not shield associated persons from liability for personal trading or other conduct that violates a fiduciary duty to advisory Clients. A summary of the Code of Ethics' Principles is outlined below.
• Integrity - Associated persons shall offer and provide professional services with integrity.
• Objectivity - Associated persons shall be objective in providing professional services to Clients.
• Competence - Associated persons shall provide services to Clients competently and maintain the necessary knowledge and skill to continue to do so in those areas in which they are engaged.
• Fairness - Associated persons shall perform professional services in a manner that is fair and reasonable to Clients, principals, partners, and employers, and shall disclose conflict(s) of interest in providing such services.
• Confidentiality - Associated persons shall not disclose confidential Client information without the specific consent of the Client unless in response to proper legal process, or as required by law.
• Professionalism - Associated persons' conduct in all matters shall reflect the credit of the profession.
• Diligence - Associated persons shall act diligently in providing professional services.
We periodically review and amend our Code of Ethics to ensure that it remains current, and we require all firm access persons to attest to their understanding of and adherence to the Code of Ethics at least annually. Our firm will provide a copy of its Code of Ethics to any Client or prospective Client upon request.
Investment Recommendations Involving a Material Financial Interest and Conflicts of Interest
Neither our firm, its associates or any related person is authorized to recommend to a Client or effect a transaction for a Client, involving any security in which our firm or a related person has a material financial interest, such as in the capacity as an underwriter, adviser to the issuer, etc.
Advisory Firm Purchase of Same Securities Recommended to Clients and Conflicts of Interest
Our firm and its “related persons” may buy or sell securities similar to, or different from, those we recommend to Clients for their accounts. In an effort to reduce or eliminate certain conflicts of interest involving the firm or personal trading, our policy may require that we restrict or prohibit associates’ transactions in specific reportable securities transactions. Any exceptions or trading pre-clearance must be approved by the firm principal in advance of the transaction in an account, and we maintain the required personal securities transaction records per regulation.
Trading Securities At/Around the Same Time as Client’s Securities
From time to time, our firm or its “related persons” may buy or sell securities for themselves at or around the same time as clients. This may provide an opportunity for representatives of MWM to buy or sell securities before or after recommending securities to clients resulting in representatives profiting off the recommendations they provide to clients. Such transactions may create a conflict of interest; however, MWM will never engage in trading that operates to the client’s disadvantage if representatives of MWM buy or sell securities at or around the same time as clients. As a fiduciary, our firm and its associates owe our clients a fiduciary duty to put the client’s interests ahead of our own, which means that we will not engage in front running when buying or selling securities for ourselves at or around the same time as clients.
Item 12: Brokerage Practices
Factors Used to Select Custodians and/or Broker-Dealers
Marathon Wealth Management LLC does not have any affiliation with Broker-Dealers. Specific custodian recommendations are made to the Client based on their need for such services. We recommend custodians based on the reputation and services provided by the firm.
1. Research and Other Soft-Dollar Benefits
We currently do not receive soft dollar benefits.
2. Brokerage for Client Referrals
We receive no referrals from a broker-dealer or third party in exchange for using that broker-dealer or third party.
3. Clients Directing Which Broker/Dealer/Custodian to Use
We do recommend a specific custodian for Clients to use, however, Clients may custody their assets at a custodian of their choice. Clients may also direct us to use a specific broker-dealer to execute transactions. By allowing Clients to choose a specific custodian, we may be unable to achieve the most favorable execution of Client transactions and this may cost Clients money over using a lower-cost custodian.
The Custodian and Brokers We Use (TD Ameritrade)
Advisor participates in the TD Ameritrade Institutional program. TD Ameritrade Institutional is a division of TD Ameritrade, Inc. ("TD Ameritrade"), member FINRA/SIPC. TD Ameritrade is an independent [and unaffiliated] SEC-registered broker-dealer. TD Ameritrade offers to independent investment Advisors services which include custody of securities, trade execution, clearance, and settlement of transactions. Advisor receives some benefits from TD Ameritrade through its participation in the program. (Please see the disclosure under Item 14 below.)
Aggregating (Block) Trading for Multiple Client Accounts
Investment advisers may elect to purchase or sell the same securities for several clients at approximately the same time when they believe such action may prove advantageous to clients. This process is referred to as aggregating orders, batch trading or block trading. We do not engage in block trading. It should be noted that implementing trades on a block or aggregate basis may be less expensive for client accounts; however, it is our trading policy to implement all client orders on an individual basis. Therefore, we do not aggregate or “block” client transactions. Considering the types of investments we hold in advisory client accounts, we do not believe clients are hindered in any way because we trade accounts individually. This is because we develop individualized investment strategies for clients and holdings will vary. Our strategies are primarily developed for the long-term and minor differences in price execution are not material to our overall investment strategy.
Item 13: Review of Accounts
Melinda Satterlee, Principal Owner and CCO of MWM, will work with Clients to obtain current information regarding their assets and investment holdings and will review this information as part of our financial planning services. MWM does not provide specific reports to financial planning Clients, other than financial plans.
Client accounts with the Investment Advisory Service will be reviewed regularly on a quarterly basis by Melinda Satterlee, Principal Owner and CCO. The account is reviewed with regards to the Client’s investment policies and risk tolerance levels. Events that may trigger a special review would be unusual performance, addition or deletions of Client imposed restrictions, excessive draw-down, volatility in performance, or buy and sell decisions from the firm or per Client's needs.
Clients will receive trade confirmations from the broker(s) for each transaction in their accounts as well as monthly or quarterly statements and annual tax reporting statements from their custodian showing all activity in the accounts, such as receipt of dividends and interest.
MWM will provide written reports to Investment Management Clients on a quarterly basis. We urge Clients to compare these reports against the account statements they receive from their custodian.
Item 14: Client Referrals and Other Compensation
We do not receive any economic benefit, directly or indirectly, from any third party for advice rendered to our Clients. Nor do we, directly or indirectly, compensate any person who is not advisory personnel for Client referrals.
As disclosed under Item 12, above, Advisor participates in TD Ameritrade’s institutional customer program and Advisor may recommend TD Ameritrade to Clients for custody and brokerage services. There is no direct link between Advisor’s participation in the program and the investment advice it gives to its Clients, although Advisor receives economic benefits through its participation in the program that are typically not available to TD Ameritrade retail investors. These benefits include the following products and services (provided without cost or at a discount): receipt of duplicate Client statements and confirmations; research related products and tools; consulting services; access to a trading desk serving Advisor participants; access to block trading (which provides the ability to aggregate securities transactions for execution and then allocate the appropriate shares to Client accounts); the ability to have advisory fees deducted directly from Client accounts; access to an electronic communications network for Client order entry and account information; access to mutual funds with no transaction fees and to certain institutional money managers; and discounts on compliance, marketing, research, technology, and practice management products or services provided to Advisor by third party vendors. TD Ameritrade may also have paid for business consulting and professional services received by Advisor’s related persons. Some of the products and services made available by TD Ameritrade through the program may benefit Advisor but may not benefit its Client accounts. These products or services may assist Advisor in managing and administering Client accounts, including accounts not maintained at TD Ameritrade. Other services made available by TD Ameritrade are intended to help Advisor manage and further develop its business enterprise. The benefits received by Advisor or its personnel through participation in the program do not depend on the number of brokerage transactions directed to TD Ameritrade. As part of its fiduciary duties to Clients, Advisor endeavors at all times to put the interests of its Clients first. Clients should be aware, however, that the receipt of economic benefits by the Advisor or its related persons in and of itself creates a potential conflict of interest and may indirectly influence the Advisor’s choice of TD Ameritrade for custody and brokerage services.
Item 15: Custody
MWM does not accept custody of Client funds except in the instance of withdrawing Client fees.
For Client accounts in which MWM directly debits their advisory fee:
i. MWM will send a copy of its invoice to the custodian at the same time that it sends the Client a copy.
ii. The custodian will send at least quarterly statements to the Client showing all disbursements for the account, including the amount of the advisory fee.
iii. The Client will provide written authorization to MWM, permitting them to be paid directly for their accounts held by the custodian.
Clients should receive at least quarterly statements from the broker-dealer, bank or other qualified custodian that holds and maintains Client's investment assets. We urge you to carefully review such statements and compare such official custodial records to the account invoice that we may provide to you. Our statements or reports may vary from custodial statements based on accounting procedures, reporting dates, or valuation methodologies of certain securities.
Item 16: Investment Discretion
Discretionary Trading: For those Client accounts where we provide Investment Management Services, we maintain discretion over Client accounts with respect to securities to be bought and sold and the amount of securities to be bought and sold. Investment discretion is explained to Clients in detail when an advisory relationship has commenced. At the start of the advisory relationship, the Client will execute a Limited Power of Attorney, which will grant our firm discretion over the account. Additionally, the discretionary relationship will be outlined in the advisory contract and signed by the Client.
Non-Discretionary Trading: MWM provides non-discretionary investment management. MWM will obtain client consent prior to investing and reinvesting the securities, cash or other property held in the client’s account in accordance with the client’s stated investment objectives as identified by the client. This non-discretionary arrangement is agreed to through the client’s agreement with the Advisor.
Item 17: Voting Client Securities
We do not vote Client proxies. Therefore, Clients maintain exclusive responsibility for: (1) voting proxies, and (2) acting on corporate actions pertaining to the Client’s investment assets. The Client shall instruct the Client’s qualified custodian to forward to the Client copies of all proxies and shareholder communications relating to the Client’s investment assets. If the Client would like our opinion on a particular proxy vote, they may contact us at the number listed on the cover of this brochure.
In most cases, you will receive proxy materials directly from the account custodian. However, in the event we were to receive any written or electronic proxy materials, we would forward them directly to you by mail, unless you have authorized our firm to contact you by electronic mail, in which case, we would forward you any electronic solicitation to vote proxies.
Item 18: Financial Information
Registered Investment Advisers are required in this Item to provide you with certain financial information or disclosures about our financial condition. We have no financial commitment that impairs our ability to meet contractual and fiduciary commitments to Clients, and we have not been the subject of a bankruptcy proceeding.
We do not have custody of Client funds or securities or require or solicit prepayment of more than $500 in fees per Client six months or more in advance.
Item 19: Requirements for State-Registered Advisers
Melinda S. Satterlee
Born: 1966
Educational Background
• 1988 – BA, Business Economics, UCSB
• 1986 – AA, Cottey College
Business Experience
• 05/2020 – Present, Marathon Wealth Management LLC, Principal Owner and CCO
• 01/2001 – 05/2020, Volunteer, Domestic Engineer
• 01/1995 – 01/2001, IFG Network Securities, Investment Advisor
• 01/1993 – 01/1995, Merrill Lynch, Investment Advisor
Professional Designations, Licensing & Exams
Series 65: Uniform Investment Adviser Law
Other Business Activities
Melinda Satterlee is not involved with outside business activities.
Performance-Based Fees
MWM is not compensated by performance-based fees.
Material Disciplinary Disclosures
No management person at Marathon Wealth Management LLC has ever been involved in an arbitration claim of any kind or been found liable in a civil, self-regulatory organization, or administrative proceeding.
Material Relationships That Management Persons Have With Issuers of Securities
Marathon Wealth Management LLC, nor Melinda Satterlee, have any relationship or arrangement with issuers of securities, in addition to what is described in Item 10.
Additional Compensation
Melinda Satterlee does not receive any economic benefit from any person, company, or organization, in exchange for providing Clients advisory services through MWM.
Supervision
Melinda Satterlee, as Principal Owner and Chief Compliance Officer of MWM, is responsible for supervision. At this time, Melinda Satterlee is the only employee of the firm and maintains a written compliance manual outlining supervisory procedures. Melinda Satterlee is responsible for supervising her own activities. This compliance manual is reviewed no less than annually. In the event additional employees are added to the firm, they will attest to having received the compliance manual and participate in annual ongoing compliance training. Melinda Satterlee may be contacted at the phone number on this brochure supplement.
Requirements for State Registered Advisers
Melinda Satterlee has NOT been involved in an arbitration, civil proceeding, self-regulatory proceeding, administrative proceeding, or a bankruptcy petition.
Marathon Wealth Management LLC
7560 NE 28th PL
Medina, Washington 98039
(425) 890-5081
Dated March 3, 2023
Form ADV Part 2B – Brochure Supplement
For
Melinda Satterlee 2344544
Principal Owner, and Chief Compliance Officer
This brochure supplement provides information about Melinda Satterlee that supplements the Marathon Wealth Management LLC (“MWM”) brochure. A copy of that brochure precedes this supplement. Please contact Melinda Satterlee if the MWM brochure is not included with this supplement or if you have any questions about the contents of this supplement.
Additional information about Melinda Satterlee is available on the SEC’s website at www.adviserinfo.sec.gov which can be found using the identification number 2344544.
Item 2: Educational Background and Business Experience
Melinda Satterlee
Born: 1966
Educational Background
• 1988 – BA, Business Economics, UCSB
• 1986 – AA, Cottey College
Business Experience
• 05/2020 – Present, Marathon Wealth Management LLC, Principal Owner and CCO
• 01/2001-05/2020, Volunteer, Domestic Engineer
• 01/1995 – 01/2001, IFG Network Securities, Investment Advisor
• 01/1993 – 01/1995, Merrill Lynch, Investment Advisor
Professional Designations, Licensing & Exams
Series 65: Uniform Investment Adviser Law
CFP Certification Professional Education Program
Item 3: Disciplinary Information
No management person at Marathon Wealth Management LLC has ever been involved in an arbitration claim of any kind or been found liable in a civil, self-regulatory organization, or administrative proceeding.
Item 4: Other Business Activities
Melinda Satterlee is not involved with outside business activities.
Item 5: Additional Compensation
Melinda Satterlee does not receive any economic benefit from any person, company, or organization, in exchange for providing Clients advisory services through MWM.
Item 6: Supervision
Melinda Satterlee, as Principal Owner and Chief Compliance Officer of MWM, is responsible for supervision. At this time, Melinda Satterlee is the only employee of the firm and maintains a written compliance manual outlining supervisory procedures. Melinda Satterlee is responsible for supervising her own activities. This compliance manual is reviewed no less than annually. In the event additional employees are added to the firm, they will attest to having received the compliance manual and participate in annual ongoing compliance training. Melinda Satterlee may be contacted at the phone number on this brochure supplement.
Item 7: Requirements for State Registered Advisers
Melinda Satterlee has NOT been involved in an arbitration, civil proceeding, self-regulatory proceeding, administrative proceeding, or a bankruptcy petition.
