Fiduciary financial advisor in Arlington, TX. For Arlington, TX residents who don't have the time, knowledge, or inclination to oversee their investments and retirement accounts themselves, partnering with a financial advisor is a great way to help meet their financial goals. Trust is paramount in that partnership, and whether you're planning for retirement, looking to increase your wealth, or saving for your kids' education, you need a financial advisor who you know will treat you and your money well. By choosing a fiduciary financial advisor in Arlington, TX, you'll gain a ally who is legally and ethically bound to put your own best interests first.
At Correct Capital Wealth Management, our Arlington, TX fiduciary financial advisors will never propose a product, investment, or strategy that we don't truly believe in ourselves. For financial advisors that adhere to the fiduciary standard and act with your best interest in mind, reach out to Correct Capital today at 314-930-401(k), contact us online, or schedule an appointment with a member of our advisor team.
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Correct Capital Wealth Management's office is physically located in St. Louis, MO, but we serve clients throughout the United States in both personal financial planning and corporate retirement plans.
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What Is a Fiduciary?
A fiduciary is a individual or entity that occupies a position of confidence and duty when handling assets, monetary matters, or legal matters for someone else. Fiduciaries are legally and ethically bound to act in the best interests of the individual or entity they are serving, often referred to as their "principal" or "beneficiary". This duty of loyalty and duty of care is known as the fiduciary standard.
Frequent examples of fiduciaries include:
- Trustees — People or institutions charged with managing and overseeing assets held in a trust for the advantage of beneficiaries.
- Executors — People chosen to handle the estate and assets of a deceased person according to their will or the law.
- Financial advisors — Professionals who provide financial advice and oversee investments for clients, with an obligation to emphasize the client's financial well-being.
- Corporate directors — Members of a company's board of directors who are bound to shareholders to try and increase their profit.
- Guardians — People appointed by the court to make decisions on behalf of people under 18 or people who are unable to make decisions for themselves.
- Attorneys — Legal professionals who are committed by a fiduciary duty to operate in the best interests of their clients when dealing with their legal affairs.
- Real estate agents — Specialists who aid clients in buying, selling, or renting properties and are expected to act in the best interests of their clients in real estate transactions.
Good Faith, Duty of Loyalty, and Duty of Care
There are three important facets to understanding fiduciary duty:
1. Good Faith
Fiduciaries have an obligation to act in "good faith," which means they deal with their clients or beneficiaries with integrity, with sincerity, and without any design to deceive or infringe upon the interests of their beneficiaries. They must consistently act honestly and with the best interests of the clients at the forefront.
2. Duty of Loyalty
Fiduciaries owe a "duty of loyalty" to the beneficiary, which means they must put first the beneficiary's interests ahead of their own. They ought to steer clear of any conflicts of interest that could compromise their capability to act solely in the beneficiary's best interests. Every conflicts of interest must be disclosed to the client or beneficiary and the advisor has to still act with the beneficiary's interest over their own.
3. Duty of Care
Fiduciaries have a "duty of care" to employ the level of care, skill, and diligence that a wise person would apply in like circumstances. They must make informed and considered decisions when managing assets or making decisions on behalf of their client or beneficiary. This duty guarantees that they do their best to protect and increase the assets under their care while minimizing risks.
What Is a Fiduciary Financial Advisor in Arlington, TX?
Financial advisors help Arlington, TX individuals, families, and business owners attain their life goals by means of a variety of financial services and recommendations. These services include investment strategies, retirement consulting, tax planning, estate planning, portfolio management and others.
Any person in Arlington, TX can call themselves a "financial advisor," but to be a fiduciary, an advisor must be registered with the SEC, and is legally required to abide by fiduciary duty, and as a result, must put clients’ interests ahead of their own. They must possess accreditations and certifications from industry organizations such as the CFP Board and Fi360. Achieving and retaining these certifications necessitate continuous education and a strict moral standard.
To illustrate, fiduciary financial advisors with a CERTIFIED FINANCIAL PLANNER™ certification need to adhere to the CFP Board's Code of Ethics and Standards of Conduct to:
- Act with honesty, integrity, competence, and diligence
- Act in the client’s best interests
- Exercise due care
- Avoid or disclose and manage conflicts of interest
- Maintain the confidentiality and protect the privacy of client information
- Act in a manner that reflects positively on the financial planning profession and CFP® certification
Are All Financial Advisors in Arlington, TX Fiduciaries?
Not all financial advisor in Arlington, TX are fiduciaries. The key reason is that financial advisors can function under various regulatory frameworks and compensation structures, leading to divergent standards of care:
- Regulatory framework — Financial advisors can be subject to different regulatory frameworks relying on their business model. For example, Registered Investment Advisors (RIAs) are generally fiduciaries. In contrast, some advisors (for example, those falling under a broker-dealer model) operate under the suitability standard, which demands strategies to be fitting for clients but does not mandate the same level of fiduciary duty.
- Compensation structure — The method financial advisors are compensated can influence their fiduciary status. Fiduciary advisors typically charge a proportional charge for their services, making their compensation transparent and minimizing conflicts of interest. Other advisors generally receive commissions or different kinds of compensation linked to product sales, which means you can't be sure that their recommendations are 100% for your benefit.
The Prudent-Person Rule
Fiduciary financial advisors must abide by the Prudent-Person Rule, commonly known as the prudent investor rule. The rule acknowledges that financial advisors cannot predict the future or determine which investments will be profitable with 100% certainty, but mandates that a fiduciary financial advisor select investments that a prudent person would purchase from an acceptable risk based on the client's goals and investment objective.
The prudent person rule originates in common law, and was eventually unified with the Uniform Prudent Investor Act. Each state might apply their own particular laws. Missouri law, for example, mandates that fiduciary financial advisors must consider:
- General economic conditions
- Potential inflation or deflation
- Expected tax consequences of investments
- The part that each investment or strategy plays within your portfolio
- Expected return and appreciation of capital
- Other assets and resources you own
- Your needs for readily available funds, income, and preservation of capital
- An asset's unique relationship or value to you, if any
- The size and nature of your portfolio, its distribution requirements, and the expected duration of your relationship with the fiduciary financial advisor
Fiduciary Duty vs. Suitability Standard: What’s the Difference?
Advisors who work under the “suitability rule” are merely obligated to suggest investment products or products that align with your goals, while financial advisors with a fiduciary duty must act in your best interest. Here are some important differences:
Fiduciary Duty
- Legal Responsibility: Fiduciary financial advisors are lawfully and morally obligated to act in their clients' best interests at all times.
- Best Interest: Advisors must focus on the client's financial well-being over their own profit.
- Comprehensive Care: They must reveal all conflicts of interest, guarantee transparency, and provide the highest standard of care in their recommendations and actions.
- Oversight: Regulated by the Investment Advisers Act of 1940, which mandates that investment advisors have a fiduciary duty to their clients.
- ExamplesInstances: Registered Investment Advisors (RIAs) and CERTIFIED FINANCIAL PLANNER™ professionals.
Suitability Standard
- Suitability: Financial advisors merely need to ensure that their recommendations are suitable for the client’s financial needs and objectives at the time of the transaction.
- Lower Standard of Care: Financial advisors can take into account their own interests as long as the recommendations are suitable.
- Possible Conflicts: Financial advisors may receive commissions from the sale of investment products, which can create conflicts of interest.
- Regulation: Governed by the Financial Industry Regulatory Authority (FINRA), which mandates a “reasonable basis” that an investment is suitable for the client.
- Examples: Some broker-dealers and insurance agents.
Best Interest vs. Reasonable Basis
The Investment Advisers Act of 1940 mandates that fiduciary advisors must act in their clients' "best interest," while FINRA Rule 2111 mandates that dealer-brokers and other non-fiduciaries only have a "reasonable basis" for their recommendations. Here's a summary of what those terms mean in relation to managing a client's investments and financial planning:
| Best Interest | Reasonable Belief | |
|---|---|---|
| Definition | Requires advisors to act in the client's best financial interest. | Mandates advisors to recommend suitable investment products or strategies based on available information. |
| Standard of Care | Superior level of care ensuring every action aligns with the client's most favorable outcome. | Ensures suggestions are suitable and make sense for the client's circumstances. |
| Client-Centric Approach | Advisors focus on client's goals, needs, and preferences above their own. | Financial advisors base suggestions on the client's stated financial situation, objectives, and risk tolerance. |
| Transparency | Total disclosure of potential conflicts of interest is necessary. | Looser disclosure requirements, provided the suggestion is suitable. |
| Due Diligence | Recommendations based on a comprehensive evaluation of the client's financial situation. | Suggestions based on reasonable research and analysis. |
| Ongoing Duty | Continuous duty to act in the client's best interest, necessitating regular reviews and updates. | Emphasizes the suitability of advice at the time of the recommendation, with reduced focus on ongoing oversight. |
| Conflict of Interest | Must reveal and handle conflicts openly, ensuring clients are aware of potential biases. | Conflicts are less strictly regulated, as long as the recommendation remains appropriate. |
| Long-Term Commitment | Advisors have a ongoing obligation to oversee and adjust the client's financial plan. | Regular reviews are suggested, but the focus is on the suitability of initial recommendations. |
Benefits of Working with a Fiduciary Financial Advisor in Arlington, TX
Deciding to work with a fiduciary financial advisor in Arlington, TX offers an array of benefits that can significantly affect your monetary health:
- Fiduciary financial advisers are required to act in your best interest and uphold ethical standards
- Full disclosure of relevant materials and facts and complete transparency regarding issues like risks, fees, and potential conflicts of interest, allowing you to make the best decisions for you and your Arlington, TX family
- Make investments on your behalf by employing their expertise to create and oversee a diversified portfolio that resonates with your goals and strategies
- Complete financial planning and a holistic approach to your financial well-being, taking into account all facets of your financial life to devise a custom approach
- Continuous monitoring and guidance to ensure your financial plans and investments stay aligned and that you can modify to any unexpected situations the market or life presents your way
- Minimized risk with prudent and responsible investment choices taken by carefully assessing the risk linked with each investment and modifying your portfolio to correspond with your risk tolerance
- Assurance that your best interests are being watched over by knowledgeable financial professionals
- A prolonged relationship with a fiduciary financial advisor that comprehends your financial goals evolve over time, and life situations modify
What Financial Planning Services Do Fiduciary Advisors Offer?
At Correct Capital Wealth Management, our holistic financial planning services are created to offer you with a holistic approach to meeting your financial goals. Our team of fiduciary financial advisors in St. Louis works diligently to grasp your unique financial situation and tailor strategies that match your life aspirations.
Personalized Financial Roadmap
We begin by performing a thorough analysis of your current financial status, including income, expenses, assets, and liabilities. This helps us formulate a personalized financial roadmap that meets your short-term needs and long-term objectives.
Investment Portfolio Management
We create personalized strategies to balance your portfolio, balancing your risk tolerance with your time horizon. Our team continuously monitors and adjusts your investments to meet your financial goals, making sure that your portfolio remains robust and adaptable to changing market conditions.
Retirement Planning
Planning for retirement is a cornerstone of our comprehensive financial planning. We assist you in navigating the complexities of retirement accounts, social security benefits, and income strategies to make certain you can retire with ease and with confidence.
Tax Planning
Effective tax planning ensures more of your hard-earned money out of Uncle Sam's hands. Our advisors are expert in tax laws and strategies that can decrease your tax liability and improve your overall financial health.
Estate Planning
We also deliver informed guidance on estate planning to help you protecting your legacy. From wills and trusts to estate tax strategies, we guarantee your assets are distributed according to your wishes while lowering tax burdens.
Continuous Oversight
Financial planning is not a single event but a constant process. We provide ongoing monitoring and routine reviews to adjust your financial plan to any alterations in your life circumstances or economic environment.
Client-Centric Approach
At Correct Capital, our approach is highly client-centric. We take pride in building lasting relationships based on trust, transparency, and personalized service. Your financial well-being is our highest priority, and we are devoted to helping you achieve your financial goals with integrity and excellence.
Other services we offer in Arlington, TX include:
- 401(k) Audit
- High-Net-Worth Wealth Management
- Retirement Planner
- Financial Planning
- Retirement Plan Consultants
- Self-Employed Retirement Plans
Hire Correct Capital as Your Arlington, TX Fiduciary Financial Advisor
Selecting a financial advisor in Arlington, TX with a fiduciary duty is essential to ensure your money is being put to use how you need it to be. At Correct Capital Wealth Management, we are proud to be fiduciary financial advisors who hold in high regard the financial success and peace of mind of Arlington, TX individuals and business owners equally. Our team includes CERTIFIED FINANCIAL PLANNER™ (CFP®) professionals and we are a Registered Investment Advisor (RIA) with the expertise and qualifications necessary to guide you on your financial journey. We provide all our clients our I.O.U promise: all of our advice will be independent, objective, and unbiased.
Get in touch with us today at 314-930-401(k) or contact us through our website to set up an appointment and find out more about how we can help you attain your financial goals in Arlington, TX.
