Fiduciary financial advisor in Columbia, IL. For Columbia, IL residents who lack the time, knowledge, or interest to handle their assets and retirement accounts on their own, partnering with a financial advisor offers peace of mind. That relationship is built on trust, and whether you're planning for retirement, seeking to grow your wealth, or ensuring a stable financial future for your loved ones, the knowledge, skill, and honesty of your financial advisor matter greatly. By choosing a fiduciary financial advisor in Columbia, IL, you'll gain a confidante who is legally and ethically bound to put your own best interests first.
At Correct Capital Wealth Management, our Columbia, IL fiduciary financial advisors won't ever recommend a solution, investment, or strategy that we do not truly believe in ourselves. For financial advisors that follow the fiduciary standard and operate with your best interest in mind, get in touch with 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, monetary matters, or legal affairs for another person. Fiduciaries are legally and ethically committed to operate 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 referred to as the fiduciary standard.
Typical examples of fiduciaries include:
- Trustees — Individuals or entities tasked with handling and monitoring assets held in a trust for the benefit of beneficiaries.
- Executors — People chosen to handle the estate and assets of a decedent according to their will or the law.
- Financial advisors — Professionals who give financial advice and handle investments for clients, with an responsibility to prioritize the client's financial goals.
- Corporate directors — Individuals of a company's board of directors who are bound to shareholders to try and increase their profit.
- Guardians — People chosen by the court to make decisions on behalf of underage individuals or persons who are not able to make decisions for themselves.
- Attorneys — Legal professionals who are bound by a fiduciary duty to act in the best interests of their clients when handling their cases.
- Real estate agents — Experts who aid clients in purchasing, 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 are mandated to act in "good faith," which means they interact with their clients or beneficiaries with integrity, with genuine intention, and without any design to deceive or infringe upon the interests of their beneficiaries. They must continually 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/beneficiary, which means they must put first the beneficiary's interests over their own. They should steer clear of any conflicts of interest that could impair their capability to act exclusively in the beneficiary's best interests. All conflicts of interest need to be revealed to the client or beneficiary and the advisor has to still act with the beneficiary's interest above their own.
3. Duty of Care
Fiduciaries have a "duty of care" to employ the standard of care, skill, and diligence that a judicious person would employ in the same or similar situations. They must make well-informed and thoughtful decisions when managing assets or deciding on behalf of their client. This duty guarantees that they do their best to protect and expand the assets under their care while reducing risks.
What Is a Fiduciary Financial Advisor in Columbia, IL?
Financial advisors help Columbia, IL individuals, families, and business owners achieve their life goals via a array of financial services and recommendations. These services include investment choices, retirement planning, tax planning, estate planning, asset management and more.
Any person in Columbia, IL can give themselves the title of "financial advisor," but to be a fiduciary, an advisor must possess credentials and certifications from industry organizations such as the CFP Board and Fi360. Securing and keeping these certifications demand persistent education and a stringent moral standard.
To illustrate, fiduciary financial advisors with a CERTIFIED FINANCIAL PLANNER™ certification need 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 Columbia, IL Fiduciaries?
Not all financial advisor in Columbia, IL is fiduciaries. The main reason lies in the fact that financial advisors can function under different regulatory frameworks and compensation structures, resulting to varying standards of care:
- Regulatory framework — Financial advisors might be subject to different regulatory frameworks based on their business model. For instance, Registered Investment Advisors (RIAs) are generally fiduciaries. On the other hand, some advisors (for example, those falling under a broker-dealer model) operate under the suitability standard, which demands strategies to be suitable for clients but does not mandate the same duties of loyalty and care.
- Compensation structure — The way financial advisors are compensated can influence their fiduciary status. Fiduciary advisors usually charge a proportional charge for their services, rendering their compensation open and limiting conflicts of interest. Other advisors typically receive commissions or different kinds of compensation tied to product sales, which means they might make recommendations that are more in their interest than yours.
The Prudent-Person Rule
Fiduciary financial advisors must abide by the Prudent-Person Rule, often 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 purchase investments that a prudent person would purchase considering an acceptable risk based on the client's goals and investment objective.
The prudent person rule originates in common law, and was later unified with the Uniform Prudent Investor Act. Each state can apply their own particular laws. Missouri law, for example, mandates that fiduciary financial advisors must consider:
- Overall economic conditions
- Potential inflation or deflation
- Expected tax consequences of investments
- The role that each investment or strategy 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 special 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 Columbia, IL
Opting to collaborate with a fiduciary financial advisor in Columbia, IL provides an array of advantages that can profoundly impact your financial health:
- Fiduciary financial advisers must act in your best interest and maintain ethical standards
- Full disclosure of relevant materials and facts and complete transparency regarding matters like risks, fees, and potential conflicts of interest, enabling you to make the most informed decisions for you and your Columbia, IL family
- Make investments on your behalf by leveraging their expertise to develop and handle a diversified portfolio that matches your financial goals and risk tolerance
- Comprehensive financial planning and a holistic approach to your financial well-being, evaluating all facets of your financial life to devise a custom approach
- Continuous monitoring and direction to guarantee your financial strategies and investments remain on track and that you can modify to any curveballs the market or life gives your way
- Diminished risk with prudent and responsible investment choices made by meticulously assessing the risk associated with each investment and tailoring your portfolio to correspond with your risk tolerance
- Assurance that your best interests are being watched over by knowledgeable financial professionals
- A lasting relationship with a fiduciary financial advisor that understands your financial goals change over time, and life scenarios change
Choose Correct Capital as Your Columbia, IL Fiduciary Financial Advisor
Selecting a financial advisor in Columbia, IL with a fiduciary standard is crucial to ensure your long-term interests remain protected. At Correct Capital Wealth Management, we are proud to be fiduciary financial advisors who place at the forefront the financial success and peace of mind of Columbia, IL residents and business owners alike. Our team includes CERTIFIED FINANCIAL PLANNER™ (CFP®) professionals and we are a Registered Investment Advisor (RIA) with the skills and qualifications necessary to guide you on your financial journey. We give all our clients our I.O.U promise: all of our advice will be independent, objective, and unbiased.
Get in touch with us now at 877-930-4015 or contact us through our website to schedule an appointment and learn more about how we can aid you attain your financial goals in Columbia, IL.
