What to Expect From a Financial Fiduciary

When it comes to managing your finances, it’s essential to trust your financial advisor. There are various types of advisors, but fiduciaries are particularly noteworthy because they adhere to distinct standards. If you’re seeking trustworthy guidance, it is important to understand the role and expectations of a financial fiduciary. Let’s take a closer look at things you should keep in mind when engaging in this type of relationship.

What is a Financial Fiduciary?

A financial fiduciary is a professional who is legally and ethically obligated to act in your best interest. This means that they are required to put your financial well-being ahead of their own interests. It may come as a surprise, but not all financial advisors are bound by the same legal and ethical principles.

Overall, financial fiduciaries only comprise about 15% of all advisors. Seeking an advisor with the Certified Financial Planner™ certification can help because their credentials reflect their expertise and dedication to ethical practices.

Financial fiduciaries bear a significant responsibility due to their legal obligation to act in their client’s best interest, which is the cornerstone of their role. However, this commitment goes beyond making recommendations and should involve a comprehensive, client-centered decision-making process.

Financial Fiduciary Communication

Effective communication and transparency are paramount in building a healthy relationship between a fiduciary advisor and their client. Clear communication with a financial fiduciary begins with a detailed understanding of their fee structure.

Clients should be aware of whether their advisor operates on a Fee-only, Fee-based, or Commission basis. Equally important is understanding the scope of the services provided – does the advisor focus solely on money management, or do they offer comprehensive wealth planning services?

Finally, and perhaps the most important, it is crucial to consider the responsiveness and communication style of the advisor.  A reliable fiduciary responds promptly to inquiries and adjusts to changes in your financial situation in a timely manner. Effective communication helps provide clarity on complex financial matters and ensures that clients are well-informed and positioned to navigate evolving circumstances. Ultimately, these factors play a significant role in the overall success of the advisor-client relationship.

Desire for Context to Manage Money

Regardless of the scope of services, a financial fiduciary should have a thorough comprehension of their client’s situation and goals to manage their money effectively. Apart from recommending investments, the fiduciary’s role involves addressing fundamental questions such as: 1) Should the client even invest considering their financial situation and goals?  or 2) What level of risk is suitable for the client’s unique circumstances? A fiduciary’s willingness to gain this additional understanding is crucial to their ability to achieve client goals.

Finding the right financial fiduciary is easier with an understanding of their legal obligations, communication style/frequency, and willingness to gain context about your full financial case facts. Remember that you are entrusting your financial well-being to these advisors, so it is important to take some extra time to find the right one for you. This will ensure a healthy, long-term relationship.




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certified financial planner Marshall Clay wears a gray jacket and white shirt while posing for professional photo in office

Marshall Clay CFP, J.D., is a Partner and Senior Advisor at The Welch Group, LLC, specializing in providing Fee-Only investment management and financial advice to families throughout the United States. Marshall is a graduate of the United States Military Academy in West Point, New York, the Cumberland School of Law in Birmingham, Alabama, and is a CERTIFIED FINANCIAL PLANNER™.  In addition, Marshall is a frequent guest on local television stations as an expert on various financial planning matters.



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