There are many ingredients going in to any professional relationship, and searching for a Financial Advisor can be particularly complex and confusing.  We’re focusing on one very important distinction when evaluating financial providers…the “F” word.

In a recent article by a Garrett Planning Network colleague, Alfred G. Fortunato, he points out ‘One’s search for the right financial advisor involves understanding an “f word” of a different sort. The first and most important such word is “fiduciary.”’  According to the online legal-definition websiteAn individual in whom another has placed the utmost trust and confidence to manage and protect property or money. The relationship wherein one person has an obligation to act for another’s benefit.”

Why is this important?  You may naturally think all Financial Advisors have fiduciary responsibility, but you may be surprised to learn this is not the case.  In fact, the majority of financial advisors do not.  This brings up the “S” word, which stands for the “Suitability Standard.”

According to Fortunato, “As registered representatives of brokerage firms stockbrokers do not have to advise clients on their clients’ best interests; instead, they need only believe that the recommended investment is suitable (i.e., reasonable) given the client’s situation.” What’s the big deal you may ask between fiduciary and suitability?

The Committee for the Fiduciary Standard believes “investors have a right to know whether or not their advisor is acting in their best interests.”  In fact, the Committee has drafted a straight-forward oath declaring an advisor’s commitment to adhere to a fiduciary ethic and, in so doing, be accountable for the advice to their clients.

When you’re choosing an advisor, one of the things to be aware of according to the Garrett Planning Network is:

WARNING: Anyone can call themselves a financial planner; no minimum experience or education is required by law at this time.

To assist you in what to look for, Garrett has a Financial Advisor Interview Questionnaire that may be useful.  Bottom line, don’t be afraid to ask tough questions of any potential financial advisor…it’s your future and your money!

We at Financial Freedom Planners take fiduciary responsibility very seriously, and embrace the following values:

  • Putting the client’s best interests first.
  • Acting with prudence; that is, with the skill, care, diligence and good judgment of a professional.
  • Not misleading clients; providing conspicuous, full and fair disclosure of all important facts.
  • Avoiding conflicts of interest; and
  • Fully disclosing and fairly managing, in the client’s favor, unavoidable conflict.

We hope you’ll check us out, and schedule a free “Getting to Know You” consultation.

“If you want to work the rest of your life, that’s your business.  If you don’t, that’s ours.”

About Charles Roberts, CFP®

Founder & CEO, Financial Freedom Planners™
This entry was posted in Financial Advice, Financial Advisor and tagged , , , , , , , , , , . Bookmark the permalink.


  1. Pingback: WHAT YOUR FINANCIAL ADVISOR DOESN’T WANT YOU TO KNOW | Financial Freedom Planners

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