I’m just going to say it: some people think that those who work in the financial industry can be kind of smarmy.
Yes, that’s a word.
And there’s a reason they think that. It’s because some advisors can be.
There are people out there who don’t have your best interests at heart. They think about the bottom line and about what products they can sell you that will make them the most money. There are people out there who aren’t interested in your values and goals – they’re only interested in your money.
And then there are fiduciaries.
What’s a fiduciary?
There are lots of ads on TV that talk about being a fiduciary, but many people aren’t familiar with that term.
Investopedia defines a fiduciary as “a person or organization that acts on behalf of another person or persons, putting their clients’ interests ahead of their own, with a duty to preserve good faith and trust. Being a fiduciary thus requires being bound both legally and ethically to act in the other’s best interests.”
This means that as an investment advisor with LPL Financial and when providing advisory services, I must act as a fiduciary. If there are multiple options in which you can invest, I must recommend the one that is in your best interest. Practically, this means that I cannot and will not recommend a product that nets me a large commission if there is a less expensive option for you that is suitable. It also means that I must disclose any conflicts of interest.
All CFPs (CERTIFIED FINANCIAL PLANNERTM) are required to act as fiduciaries in our advisory practices, so that is already part of the service I offer. I’m also part of Aspen Wealth Management which is a Registered Investment Advisory firm (this means that we charge money for advice, rather than sell products), and RIAs always follow a fiduciary standard when assisting advisory clients.
This makes a big difference in the relationship I have with my clients. They know they can trust me, because they know my recommendations will always be in advancement of their goals, and not mine.
Are all financial planners fiduciaries?
This is such an important question. No, they’re not! I am so pleased to notice that over the past few years, many more potential clients are asking if I provide advisory services as a fiduciary. I’m glad it is now part of the conversation.
As you’re looking for the right fit, I encourage you really interview the advisor and ask important questions. CLICK HERE for some guidance.
And remember – your financial planner is working for YOU. If at any time you feel they are not working in your best interest, trust your intuition and make a change.
