Fiduciary standard let’s you know who work for whom.  Why is this important?

A fiduciary is someone who puts your financial interest ahead of his or her own.  Fiduciary is derived from the Latin fidere, to trust.

Trust is the pillar in an advisory relationship. As Fee-Only advisors, we believe that a “fiduciary standard” is the very best framework for professionals to work with clients.   To act as a fiduciary means that an advisor has to put aside his/her own financial interest, and also put aside the business/financial interest of any company they work for, and give recommendations that are solely and completely in the best interest of their clients.

We are not affiliated with any broker, bank, accounting firm, law firm or insurance company. We are accountable only to our clients and have only their best interests at heart, fully embracing the concept of fiduciary responsibility. 

Most financial advisors are not held to this high standard.  Rather, they’re held to a “suitability” standard, meaning they’re supposed to reasonably believe that the investment and insurance products they want you to buy are appropriate for your situation.  Appropriate is a long way from “in your best interests”.  The real choice isn’t fiduciary vs. suitability; rather, it’s buying products from a salesperson or getting advice from an advisor.

Fee Disclosure Form

 

 

FIDUCIARY OATH

We will exercise our best efforts to act in good faith and in the best interests of our clients.

We will provide written disclosure to our clients prior to our engagement, and thereafter throughout the term of the engagement, of any conflicts of interest, which may compromise our impartiality or independence.

We do not receive any compensation or other remuneration that is contingent on any of our client’s purchase or sale of a financial product.

We do not receive a referral fee or other compensation from another party based on the referral of our client or our client’s business.

 

4 Questions to Ask Any Financial Advisor

1. Are you a fiduciary, and if so, do you have a fiduciary oath or pledge that you will sign?

2. Will you provide written disclosure prior to our engagement, and thereafter throughout the term of the engagement, of any conflicts of interest, which may compromise your impartiality or independence?

3. Do you receive any compensation or other remuneration that is contingent on any purchase or sale of a financial product?

4. Do you receive a referral fee or other compensation from another party based on a referral of a client or a client’s business?

Fee Disclosure Form

 Types Of Advice

You can always look at the fine print too:

“Your account is a brokerage account and not an advisory account.” And “Our interests may not always be the same as yours.”

If this disclaimer appears in agreements you are signing, ask your advisor how he or she is compensated and where their loyalties lie.

Then decide if the relationship is in your best interest.   Don’t be afraid to use the “F” word.