Fiduciary financial advisor in Irving, TX. For Irving, TX residents who don't have the time, knowledge, or interest to handle their assets and retirement accounts themselves, working with a financial advisor is a great way to help meet their financial goals. That relationship is built on trust, and whether you're preparing for retirement, seeking to manage your wealth, or ensuring a stable financial future for your family, the knowledge, skill, and honesty of your financial advisor are of utmost importance. By working with a fiduciary financial advisor in Irving, TX, you'll have a ally who has a legal and ethical responsibility to put your own best interests first.
At Correct Capital Wealth Management, our Irving, TX fiduciary financial advisors will never propose a solution, investment, or strategy that we do not truly have faith in ourselves. For financial advisors that follow the fiduciary standard and work with your best interest in mind, get in touch with Correct Capital now at 314-930-401(k), fill out our online form, or schedule an appointment 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 individual or entity that occupies a position of trust and duty when managing assets, finances, or legal matters on behalf of another person. Fiduciaries are legally and ethically bound to act in the best interests of the person or organization they are representing, often known as their "principal" or "beneficiary". This duty of loyalty and duty of care is referred to as the fiduciary standard.
Common examples of fiduciaries include:
- Trustees — Individuals or entities charged with managing and overseeing assets held in a trust for the benefit of beneficiaries.
- Executors — Individuals appointed to oversee the estate and assets of a deceased person based on their will or the law.
- Financial advisors — Professionals who provide financial advice and manage investments for clients, with an duty to prioritize the client's financial well-being.
- Corporate directors — Members of a company's board of directors who are entrusted with the responsibility of making decisions in the best interests of the shareholders.
- Guardians — Individuals chosen by the court to make decisions on behalf of minors or people who are incapable 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 legal matters.
- Real estate agents — Experts who help 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 aspects to understanding fiduciary duty:
1. Good Faith
Fiduciaries are obligated to act in "good faith," which means they deal with their clients or beneficiaries with integrity, with genuine intention, and without any aim to mislead or infringe upon the interests of their beneficiaries. They must continually act with integrity 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 over their own. They ought to avoid any conflicts of interest that might compromise their capacity to act exclusively in the client's best interests. Every conflicts of interest need to be made known to the client or beneficiary and the advisor needs to still act with the client/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 wise person would employ in comparable circumstances. They must make well-informed and considered decisions when overseeing assets or making decisions on behalf of their client. This duty guarantees that they do their best to shield and expand the assets within their care while reducing risks.
What Is a Fiduciary Financial Advisor in Irving, TX?
Financial advisors help Irving, TX individuals, families, and business owners realize their life goals as they relate to their finances. These services consist of investment recommendations, retirement consulting, tax planning, estate planning, asset management and others.
Any person in Irving, TX 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 need to have credentials and certifications from industry organizations such as the CFP Board and Fi360. Achieving and maintaining these certifications necessitate ongoing education and a rigorous moral standard.
For instance, fiduciary financial advisors with a CERTIFIED FINANCIAL PLANNER™ certification must 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 Irving, TX Fiduciaries?
Not all financial advisor in Irving, TX are fiduciaries. The primary reason is that financial advisors can function under various regulatory frameworks and compensation structures, resulting to varying standards of care:
- Regulatory framework — Financial advisors might be subject to different regulatory frameworks depending 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) operate under the suitability standard, which mandates recommendations to be fitting for clients but doesn't require the same duties of loyalty and care.
- Compensation structure — The manner financial advisors are compensated can influence their fiduciary status. Fiduciary advisors usually charge a percentage fee for their services, making their compensation clear and limiting conflicts of interest. Non-fiduciary advisors usually 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 must 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 mandates that a fiduciary financial advisor go for investments that a prudent person would purchase based on 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 particular laws. Missouri law, for example, stipulates that fiduciary financial advisors must consider:
- Overall economic conditions
- Possible inflation or deflation
- Expected tax implications of investments
- The role that each investment or approach plays within your portfolio
- Expected return and appreciation of capital
- Other 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 expected duration of your relationship with the fiduciary financial advisor
Fiduciary Duty vs. Suitability Standard: What’s the Difference?
Advisors who operate under the “suitability rule” are only required to recommend investment products or products that match your objectives, while advisors with a fiduciary duty must operate in your best interest. Here are some important differences:
Fiduciary Duty
- Legal Obligation: Fiduciary financial advisors are lawfully and morally bound to act in their clients' best interests at all times.
- Best Interest: Advisors must focus on the client's financial well-being over their own profit.
- Comprehensive Care: They must disclose all conflicts of interest, ensure transparency, and deliver the highest standard of care in their advice and actions.
- Regulation: Regulated 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.
- Lower Standard of Care: Financial advisors can consider their own interests as long as the suggestions are appropriate.
- Potential Conflicts: Advisors may receive commissions from the sale of financial products, which can create conflicts of interest.
- Regulation: Governed 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 mandates that fiduciary advisors must operate in their clients' "best interest," while FINRA Rule 2111 requires that dealer-brokers and other non-fiduciaries only have a "reasonable basis" for their suggestions. Here's a summary of what those terms mean in relation to dealing with a client's investments and financial planning:
| Best Interest | Reasonable Belief | |
|---|---|---|
| Definition | Requires advisors to act in the client's optimal financial interest. | Demands advisors to suggest suitable investment products or strategies based on available information. |
| Standard of Care | Superior level of care making sure every action aligns with the client's most favorable outcome. | Makes certain suggestions are appropriate and make sense for the client's situation. |
| Client-Centric Approach | Advisors focus on client's goals, needs, and preferences above their own. | Financial advisors base recommendations on the client's stated financial situation, objectives, and risk tolerance. |
| Transparency | Complete disclosure of potential conflicts of interest is required. | More relaxed disclosure requirements, as long as the suggestion is suitable. |
| Due Diligence | Suggestions based on a comprehensive evaluation of the client's financial situation. | Recommendations based on adequate research and analysis. |
| Ongoing Duty | Continuous duty to act in the client's best interest, necessitating regular reviews and updates. | Focuses on the suitability of advice at the time of the recommendation, with minimal focus on ongoing oversight. |
| Conflict of Interest | Must disclose 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 | Financial advisors have a ongoing obligation to monitor and update the client's financial plan. | Periodic reviews are advised, but the focus is on the suitability of initial recommendations. |
Benefits of Working with a Fiduciary Financial Advisor in Irving, TX
Opting to collaborate with a fiduciary financial advisor in Irving, TX brings to the table an array of advantages that can profoundly affect your financial health:
- Fiduciary financial advisers are obligated to act in your best interest and uphold professional standards
- Complete disclosure of relevant materials and facts and complete transparency concerning issues like risks, fees, and potential conflicts of interest, enabling you to make the most informed decisions for you and your Irving, TX family
- Handle investments on your behalf by leveraging their expertise to create and manage a diversified portfolio that resonates with your financial goals and risk tolerance
- Thorough financial planning and a holistic approach to your financial well-being, considering all facets of your financial life to devise a tailored approach
- Continuous monitoring and direction to ensure your financial tactics and investments continue to be in line and that you can modify to any unexpected situations the market or life presents your way
- Reduced risk with wise and judicious investment choices taken by thoroughly assessing the risk tied to each investment and modifying your portfolio to align with your risk tolerance
- Assurance that your best interests are being looked after by experienced financial professionals
- A prolonged relationship with a fiduciary financial advisor that understands your financial goals evolve over time, and life situations modify
What Financial Planning Services Do Fiduciary Advisors Offer?
At Correct Capital Wealth Management, our holistic financial planning services are designed to provide you with a holistic approach to reaching your financial goals. Our team of fiduciary financial advisors in St. Louis functions diligently to grasp your unique financial situation and adapt strategies that match your life aspirations.
Customized Financial Roadmap
We begin by performing a comprehensive analysis of your present financial status, including income, expenses, assets, and liabilities. This helps us develop a personalized financial roadmap that meets your short-term needs and long-term objectives.
Financial Portfolio Management
We create personalized strategies to diversify your portfolio, balancing your risk tolerance with your time horizon. Our team continuously monitors and adjusts your investments to align with your financial goals, ensuring that your portfolio remains robust and adaptable as market conditions change.
Retirement Planning
Planning for retirement is a cornerstone of our comprehensive financial planning. We guide you through the complexities of retirement accounts, social security benefits, and income strategies to guarantee you can retire securely and with confidence.
Tax Planning
Effective tax planning helps keep your hard-earned money in your pocket and your loved ones. Our advisors are expert in tax laws and strategies that can lower your tax liability and enhance your overall financial health.
Legacy Planning
We also provide expert guidance on estate planning to assist you in safeguarding your legacy. From wills and trusts to estate tax strategies, we guarantee your assets are distributed according to your wishes while lowering tax burdens.
Ongoing Monitoring and Adjustments
Financial planning is not a single event but a continuous process. We provide ongoing monitoring and periodic reviews to adjust your financial plan to any changes in your life circumstances or economic environment.
Client-Focused Strategy
At Correct Capital, our approach is profoundly client-centric. We take pride in building enduring relationships based on trust, transparency, and personalized service. Your financial well-being is our top priority, and we are dedicated to helping you attain your financial goals with integrity and excellence.
Other services we offer in Irving, TX 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 Irving, TX Fiduciary Financial Advisor
Selecting a financial advisor in Irving, TX with a fiduciary duty is essential to guarantee your long-term interests stay protected. At Correct Capital Wealth Management, we are proud to be fiduciary financial advisors who prioritize the financial success and peace of mind of Irving, TX 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.
Reach out to us today at 314-930-401(k) or contact us online to set up an appointment and learn more about how we can assist you achieve your financial goals in Irving, TX.
