6 Simple Questions to Ask About Your Financial Advisor’s Standards

Anyone given the power to act on behalf of another person in highly sensitive situations that require the utmost care and integrity may be called a fiduciary. Some favorite examples include: your doctor, your attorney, your banker, or your real estate agent. By that definition, we believe your financial planner should always act as your financial fiduciary whether they are expanding your investments or budgeting for your health needs after retirement. You may find this surprising–not all financial planners uphold the Fiduciary Standard!

Why is the Fiduciary Standard of practice so important to you and your family’s future? Well, it is the highest standard of care under the law and therefore provides reasonable guidelines for professionals making life-affecting decisions on their clients’ behalf. By following the Institute for the Fiduciary Standard’s clearly outlined Professional Code of Conduct, a financial planner can assure that their clients’ best interests are held above their own. Communications, total fees, expenses, any unavoidable conflicts of interests are all disclosed with clarity and truth. Written documentation of these conversations should also be easily provided by a financial planner upon the client’s request. Think of it this way: there’s no fine print; all the information you need and care about is on the table and easily accessible. The Fiduciary Standard is key to your peace of mind.

Tobias Financial Advisors has a long history of providing unbiased advice to our clients. To further cement our fiduciary commitment, we recently joined the the Institute for the Fiduciary Standard. Our alignment with this institute is reflected in our belief that a financial advisor’s participation and commitment to the Fiduciary Standard is not only in the client’s best interest but also good for the industry as a whole. In fact, our hiring process requires that all advisors be active CERTIFIED FINANCIAL PLANNER™ professionals or soon to be candidates for the designation. By meeting rigorous educational, experiential, and training requirements, the CFP® Certification adds another layer of excellence in both ethics and strategic planning. In essence, we strive to raise the bar for our industry members in hopes that other firms will be encouraged by the value of the Fiduciary Standard.

There are great financial advisor firms out there, but you do need to be careful and fully vet all advisors who you interview. If you have yet to choose a financial planner for the path ahead of you, here are some simple questions to ask a financial planner:

  • Do you as well as the rest of your firm’s financial advisors act as a client’s fiduciary?
  • Are you a CERTIFIED FINANCIAL PLANNER™ professional?
  • Will you provide documentation of our conversations when I ask you to?
  • Will you disclose all fees and expenses associated with your service and investments?
  • Will you notify me of any conflicts of interest when they arise?

While your doctor should value your health as their top priority, your financial planner should do the same for your wealth. Your financial planner has a unique position in your life. Yes, they help you accrue wealth and grow your assets, but they should do so under the highest standard of care so that you are ready for whatever life delivers.

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