Fiduciary financial advisor in Ballwin, MO. For Ballwin, MO residents who don't have the free time, expertise, or inclination to handle their assets and retirement accounts themselves, working with a financial advisor is a great way to help meet their financial goals. Trust is crucial in that relationship, 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 Ballwin, MO, you'll gain a ally who is legally and ethically obliged to put your own best interests first.
At Correct Capital Wealth Management, our Ballwin, MO fiduciary financial advisors will never propose a solution, investment, or plan that we don't sincerely trust in ourselves. For financial advisors that adhere to the fiduciary standard and act with your best interest as their top priority, reach out to Correct Capital today at 877-930-4015, fill out our online form, or schedule an appointment with a member of our advisor team.
What Is a Fiduciary?
A fiduciary is a individual or organization that maintains a position of trust and duty when handling assets, finances, or legal matters on behalf of another. Fiduciaries are legally and ethically bound to act in the best interests of the person or organization they are representing, often referred to as their "principal" or "beneficiary". This duty of loyalty and duty of care is known as the fiduciary standard.
Common examples of fiduciaries are:
- Trustees — People or entities charged with handling and overseeing assets held in a trust for the benefit of beneficiaries.
- Executors — Individuals designated to oversee the estate and assets of a decedent based on their will or the law.
- Financial advisors — Professionals who provide financial advice and manage investments for clients, with an duty to put first the client's financial well-being.
- Corporate directors — Representatives 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 minors or people who are not able to make decisions for themselves.
- Attorneys — Legal professionals who are committed by a fiduciary duty to act in the best interests of their clients when dealing with their cases.
- Real estate agents — Specialists who assist 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 crucial aspects to understanding fiduciary duty:
1. Good Faith
Fiduciaries have an obligation to act in "good faith," which means they engage with their clients or beneficiaries truthfully, with sincerity, and without any aim to deceive or damage the interests of their beneficiaries. They must continually act honestly and with the best interests of the clients in mind.
2. Duty of Loyalty
Fiduciaries owe a "duty of loyalty" to the client, which means they must put first the beneficiary's interests ahead of their own. They should avoid any conflicts of interest that could compromise their capability to act exclusively in the beneficiary's best interests. Every conflicts of interest must be revealed to the client and the advisor has to still act with the client/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 prudent person would use in similar circumstances. They must make well-informed and careful decisions when handling assets or making decisions on behalf of their client or beneficiary. This duty ensures that they strive to shield and grow the assets under their care while minimizing risks.
What Is a Fiduciary Financial Advisor in Ballwin, MO?
Financial advisors help Ballwin, MO individuals, families, and business owners attain their life goals as they relate to their finances. These services comprise investment recommendations, retirement planning, tax planning, estate planning, portfolio management and others.
Any person in Ballwin, MO can give themselves the title of "financial advisor," but to say that they're a fiduciary, an advisor needs accreditations and certifications from industry organizations such as the CFP Board and Fi360. Obtaining and maintaining these certifications necessitate persistent education and a stringent moral standard.
To illustrate, fiduciary financial advisors with a CERTIFIED FINANCIAL PLANNER™ certification are required to comply with 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 Ballwin, MO Fiduciaries?
Not all financial advisor in Ballwin, MO are fiduciaries. The main reason lies in the fact that financial advisors can work under various regulatory frameworks and compensation structures, resulting to varying standards of care:
- Regulatory framework — Financial advisors might be subject to distinct regulatory oversight relying on their business model. For instance, Registered Investment Advisors (RIAs) are usually fiduciaries. On the other hand, some advisors (for example, those under a broker-dealer model) operate under the suitability standard, which mandates advice to be fitting for clients but doesn't require the same duties of loyalty and care.
- Compensation structure — The way financial advisors are compensated can affect their fiduciary status. Fiduciary advisors often charge a percentage fee for their services, rendering their compensation transparent and limiting conflicts of interest. Other advisors generally receive commissions or different kinds of compensation linked to product sales, which means they could make recommendations that are more in their interest than yours.
The Prudent-Person Rule
Fiduciary financial advisors need to 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 ahead of time, but stipulates that a fiduciary financial advisor go for investments that a sensible person would purchase from an acceptable risk based on the client's goals and investment objective.
The prudent person rule is an early common law principle, and was later unified with the Uniform Prudent Investor Act. Each state might apply their own specific laws. Missouri law, for example, sets out that fiduciary financial advisors must consider:
- General economic conditions
- Possible inflation or deflation
- Expected tax implications of investments
- The part that each investment or strategy plays within your portfolio
- Expected profit 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 estimated duration of your relationship with the fiduciary financial advisor
Benefits of Working with a Fiduciary Financial Advisor in Ballwin, MO
Choosing to partner with a fiduciary financial advisor in Ballwin, MO provides an array of benefits that can significantly affect your fiscal health:
- Fiduciary financial advisers must act in your best interest and maintain ethical standards
- Full disclosure of essential materials and facts and full transparency concerning issues like risks, fees, and potential conflicts of interest, allowing you to make the optimal decisions for you and your Ballwin, MO family
- Make investments on your behalf by leveraging their expertise to craft and manage a diversified portfolio that aligns with your goals and strategies
- Complete financial planning and a well-rounded approach to your financial well-being, evaluating all facets of your financial life to establish a tailored approach
- Consistent monitoring and direction to ensure your financial tactics and investments remain on track and that you can adjust to any curveballs the market or life gives your way
- Reduced risk with sensible and accountable investment choices taken by thoroughly assessing the risk tied to each investment and shaping your portfolio to match your risk tolerance
- Peace of mind that your best interests are being cared for by knowledgeable financial professionals
- A prolonged relationship with a fiduciary financial advisor that comprehends your financial goals evolve over time, and life scenarios alter
Hire Correct Capital as Your Ballwin, MO Fiduciary Financial Advisor
Selecting a financial advisor in Ballwin, MO with a fiduciary duty is vital to ensure your long-term interests stay protected. At Correct Capital Wealth Management, we are honored to be fiduciary financial advisors who prioritize the financial success and peace of mind of Ballwin, MO residents and business owners alike. Our team is comprised of CERTIFIED FINANCIAL PLANNER™ (CFP®) professionals and we are a Registered Investment Advisor (RIA) with the knowledge and qualifications essential to lead 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 877-930-4015 or contact us through our website to arrange an appointment and learn more about how we can assist you reach your financial goals in Ballwin, MO.
