Fiduciary financial advisor in Clayton, MO. For Clayton, MO residents who don't have the free time, knowledge, 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 vital in that relationship, and whether you're preparing for retirement, looking to manage your wealth, or ensuring a stable financial future for your family, the knowledge, skill, and integrity of your financial advisor are of utmost importance. By working with a fiduciary financial advisor in Clayton, MO, you'll gain a confidante who is legally and ethically bound to put your own best interests first.
At Correct Capital Wealth Management, our Clayton, MO fiduciary financial advisors will never recommend a solution, investment, or strategy that we don't sincerely believe in ourselves. For financial advisors that uphold the fiduciary standard and work with your best interest at heart, call Correct Capital today at 877-930-4015, contact us through our wesbite, or schedule an appointment with a member of our advisor team.
Understanding Fiduciaries
A fiduciary is a individual or organization that maintains a position of confidence and responsibility when overseeing assets, monetary matters, or legal affairs on behalf of another. Fiduciaries are legally and ethically committed to work in the best interests of the person or entity they are representing, often known as their "principal" or "beneficiary". This duty of loyalty and duty of care is known as the fiduciary standard.
Typical examples of fiduciaries are:
- Trustees — People or entities charged with managing and overseeing assets held in a trust for the advantage of beneficiaries.
- Executors — Individuals designated to handle the estate and assets of a decedent according to their will or the law.
- Financial advisors — Professionals who provide financial advice and oversee investments for clients, with an obligation to prioritize the client's financial goals.
- Corporate directors — Representatives of a company's board of directors who are given making decisions in the best interests of the shareholders.
- Guardians — People chosen by the court to make decisions on behalf of underage individuals or people who are not able to make decisions for themselves.
- Attorneys — Lawyers who are committed by a fiduciary duty to operate in the best interests of their clients when handling their cases.
- Real estate agents — Experts 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 important facets to understanding fiduciary duty:
1. Good Faith
Fiduciaries have an obligation to act in "good faith," which means they interact with their clients or beneficiaries truthfully, with sincerity, and without any aim to mislead or harm the interests of their beneficiaries. They must consistently act honestly and with the best interests of the clients as a priority.
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 ought to avoid any conflicts of interest that could compromise their capability to act only in the beneficiary's best interests. All conflicts of interest need to be disclosed to the client or beneficiary and the advisor must still act with the beneficiary's interest over their own.
3. Duty of Care
Fiduciaries have a "duty of care" to apply the level of care, skill, and diligence that a judicious person would use in similar circumstances. They must make informed and thoughtful decisions when handling assets or deciding on behalf of their client. This duty confirms that they work diligently to safeguard and grow the assets within their care while mitigating risks.
What Is a Fiduciary Financial Advisor in Clayton, MO?
Financial advisors help Clayton, MO individuals, families, and business owners achieve their life goals as they relate to their finances. These services include investment recommendations, retirement consulting, tax planning, estate planning, portfolio management and more.
Anyone in Clayton, MO can give themselves the title of "financial advisor," but to be a fiduciary, an advisor needs credentials and certifications from industry organizations such as the CFP Board and Fi360. Achieving and maintaining these certifications demand ongoing education and a rigorous 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 Clayton, MO Fiduciaries?
Not all financial advisor in Clayton, MO is fiduciaries. The primary reason lies in the fact that financial advisors can function under various regulatory frameworks and compensation structures, resulting to differentiated standards of care:
- Regulatory framework — Financial advisors can be subject to different regulatory oversight based on their business model. For instance, Registered Investment Advisors (RIAs) are usually fiduciaries. In contrast, some advisors (for example, those under a broker-dealer model) work under the suitability standard, which demands recommendations to be suitable for clients but doesn't require the same duties of loyalty and care.
- Compensation structure — The way financial advisors are compensated can influence their fiduciary status. Fiduciary advisors typically charge a percentage fee for their services, making their compensation transparent and reducing conflicts of interest. Other advisors typically receive commissions or other forms of compensation associated with product sales, which means you can't be sure that their recommendations are 100% for your benefit.
The Prudent-Person Rule
Fiduciary financial advisors are required to abide by the Prudent-Person Rule, also known as the prudent investor rule. The rule acknowledges that financial advisors can't predict the future or know which investments will be profitable ahead of time, but mandates that a fiduciary financial advisor purchase investments that a prudent person would purchase from an acceptable risk in light of the client's goals and investment objective.
The prudent person rule is an early common law principle, and was subsequently unified with the Uniform Prudent Investor Act. Each state may apply their own specific laws. Missouri law, for example, stipulates that fiduciary financial advisors must consider:
- General economic conditions
- Potential inflation or deflation
- Expected tax consequences of investments
- The part that each investment or course of action plays within your portfolio
- Expected return and appreciation of capital
- Additional assets and resources you own
- Your needs for readily available funds, income, and preservation of capital
- An asset's distinctive relationship or value to you, if any
- The size and nature of your portfolio, its distribution requirements, and the anticipated duration of your relationship with the fiduciary financial advisor
Benefits of Working with a Fiduciary Financial Advisor in Clayton, MO
Deciding to work with a fiduciary financial advisor in Clayton, MO provides an array of benefits that can significantly impact your monetary health:
- Fiduciary financial advisers must act in your best interest and maintain professional standards
- Complete disclosure of essential 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 Clayton, MO family
- Handle investments on your behalf utilizing their expertise to develop and handle a diversified portfolio that resonates with your financial goals and risk tolerance
- Comprehensive financial planning and a full approach to your financial well-being, taking into account all facets of your financial life to create a custom approach
- Ongoing monitoring and guidance to guarantee your financial plans and investments continue to be in line and that you can adapt to any curveballs the market or life throws your way
- Diminished risk with wise and judicious investment choices made by carefully assessing the risk tied to each investment and tailoring your portfolio to align with your risk tolerance
- Assurance that your best interests are being watched over by experienced financial professionals
- A prolonged relationship with a fiduciary financial advisor that comprehends your financial goals shift over time, and life conditions alter
Hire Correct Capital as Your Clayton, MO Fiduciary Financial Advisor
Selecting a financial advisor in Clayton, MO with a fiduciary standard is essential to guarantee your long-term interests stay protected. At Correct Capital Wealth Management, we are honored to be fiduciary financial advisors who place at the forefront the financial success and peace of mind of Clayton, MO individuals and business owners alike. Our team includes CERTIFIED FINANCIAL PLANNER™ (CFP®) professionals and we are a Registered Investment Advisor (RIA) with the knowledge and qualifications essential to assist 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.
Reach out to us today at 877-930-4015 or contact us through our website to arrange an appointment and find out more about how we can help you reach your financial goals in Clayton, MO.
