Fiduciary financial advisor in Dayton, OH. For Dayton, OH residents who lack the free time, expertise, or inclination to handle 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 relationship, and whether you're preparing for retirement, seeking 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 Dayton, OH, you'll have a confidante who has a legal and ethical responsibility to put your own best interests first.
At Correct Capital Wealth Management, our Dayton, OH fiduciary financial advisors will never suggest a solution, investment, or approach that we don't truly believe in ourselves. For financial advisors that uphold the fiduciary standard and operate with your best interest as their top priority, reach out to Correct Capital now at 314-930-401(k), contact us online, or schedule a meeting with on of our advisors.
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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 person or organization that holds a position of confidence and duty when managing assets, finances, or legal affairs on behalf of another person. Fiduciaries are legally and ethically obliged to work in the best interests of the individual or entity they are representing, often known as their "principal" or "beneficiary". This duty of loyalty and duty of care is called the fiduciary standard.
Frequent examples of fiduciaries include:
- Trustees — People or entities charged with handling and overseeing assets held in a trust for the advantage of beneficiaries.
- Executors — People appointed to manage the estate and assets of a decedent according to their will or the law.
- Financial advisors — Professionals who provide financial advice and manage investments for clients, with an obligation to put first the client's financial well-being.
- Corporate directors — Representatives of a company's board of directors who are assigned making decisions in the best interests of the shareholders.
- Guardians — People chosen by the court to make decisions on behalf of people under 18 or persons who are not able to make decisions for themselves.
- Attorneys — Legal professionals who are obligated by a fiduciary duty to work in the best interests of their clients when dealing with their legal affairs.
- Real estate agents — Professionals who aid clients in buying, selling, or renting properties and are required 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 vital facets to understanding fiduciary duty:
1. Good Faith
Fiduciaries are mandated to act in "good faith," which means they deal with their clients or beneficiaries honestly, with genuine intention, and without any intention to deceive 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 beneficiary, which means they must put first the beneficiary's interests over their own. They must avoid any conflicts of interest that might jeopardize their ability to act exclusively in the client's best interests. Every conflicts of interest need to be revealed to the client and the advisor must still act with the client/beneficiary's interest above their own.
3. Duty of Care
Fiduciaries have a "duty of care" to employ the degree of care, skill, and diligence that a wise person would apply in the same or similar situations. 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 work diligently to shield and expand the assets within their care while mitigating risks.
What Is a Fiduciary Financial Advisor in Dayton, OH?
Financial advisors help Dayton, OH individuals, families, and business owners achieve their life goals as they relate to their finances. These services comprise investment choices, retirement planning, tax planning, estate planning, portfolio management and others.
Any person in Dayton, OH can give themselves the title of "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 have to have accreditations and certifications from industry organizations such as the CFP Board and Fi360. Achieving and retaining these certifications require continuous education and a stringent moral standard.
To illustrate, fiduciary financial advisors with a CERTIFIED FINANCIAL PLANNER™ certification must 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 Dayton, OH Fiduciaries?
Not all financial advisor in Dayton, OH are fiduciaries. The main reason is that financial advisors can function under various regulatory frameworks and compensation structures, resulting to varying 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 usually fiduciaries. Conversely, some advisors (for example, those falling under a broker-dealer model) function under the suitability standard, which mandates recommendations to be appropriate for clients but doesn't require the same level of fiduciary duty.
- Compensation structure — The method financial advisors are compensated can affect their fiduciary status. Fiduciary advisors often charge a proportional charge for their services, making their compensation clear and minimizing conflicts of interest. Other advisors generally 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 need 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 with 100% certainty, but stipulates that a fiduciary financial advisor go for investments that a reasonable person would purchase considering an acceptable risk in light of the client's goals and investment objective.
The prudent person rule has its origins in in common law, and was later unified with the Uniform Prudent Investor Act. Each state may apply their own specific laws. Missouri law, for example, mandates that fiduciary financial advisors must consider:
- Overall economic conditions
- Possible inflation or deflation
- Expected tax implications of investments
- The role that each investment or strategy plays within your portfolio
- Expected return and appreciation of capital
- Additional assets and resources you have
- 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
Fiduciary Duty vs. Suitability Standard: What’s the Difference?
Advisors who work under the “suitability standard” are only required to suggest investment products or financial products that align with your objectives, while financial advisors with a fiduciary duty must act in your best interest. Here are some important differences:
Fiduciary Duty
- Legal and Ethical Responsibility: Fiduciary financial advisors are lawfully and ethically obligated to act in their clients' best interests at all times.
- Best Interest: Advisors must prioritize the client's financial well-being over their own profit.
- Comprehensive Care: They must disclose all conflicts of interest, guarantee transparency, and provide the highest standard of care in their advice and actions.
- Governance: Regulated by the Investment Advisers Act of 1940, which requires that investment advisors have a fiduciary duty to their clients.
- ExamplesInstances: Registered Investment Advisors (RIAs) and CERTIFIED FINANCIAL PLANNER™ professionals.
Suitability Standard
- Appropriateness: Financial advisors only 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: Advisors can consider their own interests as long as the recommendations are appropriate.
- Potential Conflicts: Advisors may earn commissions from the sale of financial products, which can create conflicts of interest.
- Governance: Regulated 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 operate in their clients' "best interest," while FINRA Rule 2111 stipulates that dealer-brokers and other non-fiduciaries simply have a "reasonable basis" for their suggestions. Here's a breakdown of what those terms mean in relation to managing a client's investments and financial planning:
| Best Interest | Reasonable Belief | |
|---|---|---|
| Definition | Demands financial advisors to act in the client's optimal financial interest. | Demands financial advisors to recommend appropriate products or strategies based on provided information. |
| Standard of Care | Higher level of care making sure every action aligns with the client's most favorable outcome. | Makes certain recommendations are appropriate and make sense for the client's circumstances. |
| Client-Centric Approach | Financial advisors focus on client's goals, needs, and preferences above their own. | Advisors base suggestions on the client's stated financial situation, objectives, and risk tolerance. |
| Transparency | Full disclosure of potential conflicts of interest is required. | Looser disclosure requirements, so long as the suggestion is appropriate. |
| Due Diligence | Suggestions based on a comprehensive evaluation of the client's financial situation. | Recommendations based on reasonable research and analysis. |
| Ongoing Duty | Unceasing duty to act in the client's best interest, necessitating regular reviews and updates. | Focuses on the appropriateness of advice at the time of the recommendation, with reduced focus on ongoing oversight. |
| Conflict of Interest | Must reveal and manage conflicts transparently, ensuring clients are aware of potential biases. | Conflicts are more loosely governed, as long as the recommendation remains appropriate. |
| Long-Term Commitment | Advisors have a continuous obligation to monitor and update the client's financial plan. | Periodic reviews are advised, but the focus is on the suitability of initial suggestions. |
Benefits of Working with a Fiduciary Financial Advisor in Dayton, OH
Choosing to partner with a fiduciary financial advisor in Dayton, OH brings to the table an array of benefits that can deeply impact your fiscal health:
- Fiduciary financial advisers are required to act in your best interest and adhere to high standards
- Full disclosure of essential materials and facts and complete transparency with issues like risks, fees, and potential conflicts of interest, permitting you to make the optimal decisions for you and your Dayton, OH family
- Make investments on your behalf by employing their expertise to craft and manage a diversified portfolio that aligns with your financial goals and risk tolerance
- Comprehensive financial planning and a full approach to your financial well-being, evaluating all facets of your financial life to establish a tailored approach
- Consistent monitoring and advice to ensure your financial strategies and investments stay aligned and that you can adjust to any surprises the market or life presents your way
- Minimized risk with wise and accountable 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 experienced financial advisors
- A prolonged relationship with a fiduciary financial advisor that grasps your financial goals evolve over time, and life scenarios alter
What Financial Planning Services Do Fiduciary Advisors Offer?
At Correct Capital Wealth Management, our all-encompassing financial planning services are designed to offer you with a holistic approach to reaching your financial goals. Our team of fiduciary financial advisors in St. Louis functions diligently to understand your unique financial situation and tailor strategies that align with your life aspirations.
Customized Financial Roadmap
We begin by conducting a detailed analysis of your present financial status, including income, expenses, assets, and liabilities. This helps us develop a personalized financial roadmap that addresses your short-term needs and long-term objectives.
Investment Portfolio Management
We craft personalized strategies to diversify your portfolio, making sure your risk tolerance aligns with your time horizon. Our team consistently monitors and adjusts your investments to meet your financial goals, ensuring that your portfolio remains robust and adaptable as market conditions change.
Retirement Strategy
Planning for retirement is a foundation of our comprehensive financial planning. We guide you through the complexities of retirement accounts, social security benefits, and income strategies to ensure you can retire comfortably and safely.
Tax Planning
Effective tax planning helps keep your hard-earned money out of Uncle Sam's hands. Our advisors are expert in tax laws and strategies that can reduce your tax liability and enhance your overall financial health.
Estate Planning
We also deliver educated guidance on estate planning to help you safeguarding your legacy. From wills and trusts to estate tax strategies, we ensure your assets are distributed according to your wishes while minimizing tax burdens.
Continuous Oversight
Financial planning is not a once-off event but a ongoing process. We deliver ongoing monitoring and periodic 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 profoundly client-centric. We take pride in building lasting relationships based on trust, transparency, and personalized service. Your financial well-being is our top priority, and we are dedicated to helping you achieve your financial goals with integrity and excellence.
Other services we offer in Dayton, OH include:
- Investment Management
- 401(k) Audit
- High-Net-Worth Wealth Management
- Retirement Planner
- Financial Planning
- Retirement Plan Consultants
Hire Correct Capital as Your Dayton, OH Fiduciary Financial Advisor
Selecting a financial advisor in Dayton, OH with a fiduciary standard is essential to guarantee your long-term interests remain protected. At Correct Capital Wealth Management, we are pleased to be fiduciary financial advisors who hold in high regard the financial success and peace of mind of Dayton, OH individuals and business owners alike. Our team is comprised of CERTIFIED FINANCIAL PLANNER™ (CFP®) professionals and we are a Registered Investment Advisor (RIA) with the skills and qualifications essential to lead 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 314-930-401(k) or contact us through our website to arrange an appointment and discover how we can aid you reach your financial goals in Dayton, OH.
