Fiduciary financial advisor in Des Moines, IA. For those in Des Moines, IA who lack the free time, skill, or interest to oversee their assets and retirement accounts on their own, partnering with a financial advisor offers peace of mind. Trust is paramount in that partnership, 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 Des Moines, IA, you'll have a confidante who is legally and ethically bound to put your own best interests first.
At Correct Capital Wealth Management, our Des Moines, IA fiduciary financial advisors will never recommend a product, investment, or plan that we don't truly have faith 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 today at 314-930-401(k), fill out our online form, 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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Understanding Fiduciaries
A fiduciary is a person or entity that holds a position of trust and responsibility when overseeing assets, monetary matters, or legal matters for another person. Fiduciaries are legally and ethically obliged to operate 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 called the fiduciary standard.
Common examples of fiduciaries are:
- Trustees — Individuals or entities tasked with handling and monitoring assets held in a trust for the benefit of beneficiaries.
- Executors — People designated to oversee 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 duty to prioritize 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 — Individuals appointed by the court to make decisions on behalf of minors or persons who are incapable to make decisions for themselves.
- Attorneys — Legal professionals who are bound by a fiduciary duty to work in the best interests of their clients when handling legal matters.
- Real estate agents — Professionals who help 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 elements 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 honestly, with genuine intention, and without any aim to deceive or damage 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 prioritize the beneficiary's interests ahead of their own. They must steer clear of any conflicts of interest that could compromise their ability to act exclusively in the beneficiary's best interests. Every conflicts of interest must be made known to the client 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 exercise the level of care, skill, and diligence that a prudent person would employ in the same or similar situations. They must make well-informed and careful decisions when managing assets or making decisions on behalf of their client or beneficiary. This duty ensures that they do their best to safeguard and expand the assets within their care while mitigating risks.
What Is a Fiduciary Financial Advisor in Des Moines, IA?
Financial advisors help Des Moines, IA individuals, families, and business owners attain their life goals by means of a range of financial services and recommendations. These services comprise investment recommendations, retirement consulting, tax planning, estate planning, portfolio management and others.
Any person in Des Moines, IA can give themselves the title of "financial advisor," but to say that they're 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 need to have qualifications and certifications from industry organizations such as the CFP Board and Fi360. Obtaining and keeping these certifications demand continuous education and a rigorous moral standard.
For instance, 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 Des Moines, IA Fiduciaries?
Not all financial advisor in Des Moines, IA is fiduciaries. The main reason is 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 example, Registered Investment Advisors (RIAs) are usually fiduciaries. In contrast, some advisors (for example, those falling under a broker-dealer model) work under the suitability standard, which mandates investments to be fitting for clients but doesn't require the same level of fiduciary duty.
- Compensation structure — The method financial advisors are compensated may impact their fiduciary status. Fiduciary advisors typically charge a proportional charge for their services, making their compensation clear and reducing conflicts of interest. Other advisors generally receive commissions or other forms of compensation tied 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 need to abide by the Prudent-Person Rule, often known as the prudent investor rule. The rule acknowledges that financial advisors can't predict the future or determine which investments will be profitable ahead of time, but mandates that a fiduciary financial advisor select investments that a reasonable person would purchase from an acceptable risk considering the client's goals and investment objective.
The prudent person rule originates in common law, and was subsequently unified with the Uniform Prudent Investor Act. Each state can apply their own unique laws. Missouri law, for example, sets out that fiduciary financial advisors must consider:
- General economic conditions
- Potential inflation or deflation
- Expected tax consequences of investments
- The role that each investment or course of action plays within your portfolio
- Expected profit and appreciation of capital
- Other assets and resources you have
- Your needs for liquidity, 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 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 obligated to suggest investment products or financial products that match your goals, while financial advisors with a fiduciary duty must operate in your best interest. Here are some important differences:
Fiduciary Duty
- Legal and Ethical Obligation: Fiduciary financial advisors are legally and ethically obligated to act in their clients' best interests at all times.
- Client's Best Interest: Financial advisors must focus on the client's financial well-being over their own profit.
- Comprehensive Care: They must reveal all conflicts of interest, ensure transparency, and deliver the highest standard of care in their advice and actions.
- Governance: Governed 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
- Appropriateness: Advisors merely need to ensure that their recommendations are appropriate for the client’s financial needs and objectives at the time of the transaction.
- Reduced Care Standard: Financial advisors can consider their own interests as long as the recommendations are appropriate.
- Potential Conflicts: Financial advisors may earn commissions from the sale of financial products, which can create conflicts of interest.
- Regulation: Regulated by the Financial Industry Regulatory Authority (FINRA), which requires a “reasonable basis” that an investment is appropriate for the client.
- Examples: Some broker-dealers and insurance agents.
Best Interest vs. Reasonable Basis
The Investment Advisers Act of 1940 stipulates that fiduciary advisors must act in their clients' "best interest," while FINRA Rule 2111 mandates that dealer-brokers and other non-fiduciaries simply have a "reasonable basis" for their recommendations. 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 | Requires advisors to act in the client's most favorable financial interest. | Demands advisors to recommend suitable products or plans based on provided information. |
| Standard of Care | Higher level of care making sure every action aligns with the client's most favorable outcome. | Ensures recommendations are appropriate and make sense for the client's circumstances. |
| Client-Centric Approach | Financial advisors prioritize client's objectives, needs, and preferences above their own. | Financial advisors base recommendations on the client's disclosed financial situation, objectives, and risk tolerance. |
| Transparency | Total disclosure of potential conflicts of interest is necessary. | Less stringent disclosure requirements, as long as the recommendation is appropriate. |
| Due Diligence | Suggestions based on a comprehensive evaluation of the client's financial situation. | Suggestions based on adequate research and analysis. |
| Ongoing Duty | Ongoing duty to act in the client's best interest, requiring regular reviews and updates. | Stresses the appropriateness of advice at the time of the recommendation, with minimal focus on ongoing oversight. |
| Conflict of Interest | Must disclose and manage conflicts openly, ensuring clients are aware of potential biases. | Conflicts are less tightly controlled, as long as the recommendation remains suitable. |
| Long-Term Commitment | Advisors have a continuous obligation to monitor and adjust the client's financial plan. | Periodic reviews are recommended, but the focus is on the suitability of initial recommendations. |
Benefits of Working with a Fiduciary Financial Advisor in Des Moines, IA
Opting to collaborate with a fiduciary financial advisor in Des Moines, IA provides an array of advantages that can deeply influence your monetary health:
- Fiduciary financial advisers must act in your best interest and maintain ethical standards
- Total disclosure of pertinent materials and facts and full transparency concerning issues like risks, fees, and potential conflicts of interest, enabling you to make the optimal decisions for you and your Des Moines, IA family
- Handle investments on your behalf by employing their expertise to craft and oversee a diversified portfolio that resonates with your financial goals and risk tolerance
- Complete financial planning and a holistic approach to your financial well-being, considering all facets of your financial life to create a tailored approach
- Continuous monitoring and guidance to ensure your financial tactics and investments stay aligned and that you can modify to any surprises the market or life gives your way
- Diminished risk with wise and responsible investment choices made by thoroughly assessing the risk linked with each investment and shaping your portfolio to match your risk tolerance
- Assurance that your best interests are being looked after by experienced financial advisors
- A prolonged relationship with a fiduciary financial advisor that understands your financial goals evolve over time, and life situations change
What Financial Planning Services Do Fiduciary Advisors Offer?
At Correct Capital Wealth Management, our holistic financial planning services are created to provide you with a holistic approach to meeting your financial goals. Our team of fiduciary financial advisors in St. Louis functions diligently to grasp your unique financial situation and customize strategies that align with your life aspirations.
Personalized Financial Roadmap
We begin by performing a detailed analysis of your present 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 develop 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 Strategy
Planning for retirement is a foundation of our comprehensive financial planning. We assist you in navigating the complexities of retirement accounts, social security benefits, and income strategies to guarantee you can retire with ease and with confidence.
Tax Planning
Effective tax planning ensures more of your hard-earned money in your pocket and your family. 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 educated guidance on estate planning to assist you in protecting your legacy. From wills and trusts to estate tax strategies, we ensure your assets are distributed according to your wishes while lowering tax burdens.
Continuous Oversight
Financial planning is not a single event but a continuous process. We deliver ongoing monitoring and regular reviews to modify your financial plan to any shifts in your life circumstances or economic environment.
Client-Centric Approach
At Correct Capital, our approach is deeply client-centric. We take pride in building long-lasting relationships based on trust, transparency, and personalized service. Your financial well-being is our highest priority, and we are devoted to helping you attain your financial goals with integrity and excellence.
Other services we offer in Des Moines, IA 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 Des Moines, IA Fiduciary Financial Advisor
Selecting a financial advisor in Des Moines, IA with a fiduciary standard is crucial to guarantee your money is being put to use how you need it to be. At Correct Capital Wealth Management, we are honored to be fiduciary financial advisors who prioritize the financial success and peace of mind of Des Moines, IA 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 skills and qualifications essential to guide you on your financial journey. We offer all our clients our I.O.U promise: all of our advice will be independent, objective, and unbiased.
Reach out to us today at 314-930-401(k) or contact us through our website to schedule an appointment and learn more about how we can assist you achieve your financial goals in Des Moines, IA.
