Fiduciary financial advisor in New York City, NY. For those in New York City, NY who lack the free time, expertise, or interest to handle their investments and retirement accounts themselves, working with a financial advisor is a great way to help meet their financial goals. Trust is paramount in that partnership, and whether you're planning for retirement, seeking to grow your wealth, or ensuring a stable financial future for your loved ones, you need a financial advisor who you know will be an honest steward of your assets. By choosing a fiduciary financial advisor in New York City, NY, you'll have a ally who is legally and ethically committed to put your own best interests first.
At Correct Capital Wealth Management, our New York City, NY fiduciary financial advisors won't ever recommend a solution, investment, or strategy that we don't sincerely trust in ourselves. For financial advisors that follow the fiduciary standard and act with your best interest at heart, call Correct Capital today at 314-930-401(k), contact us through our wesbite, 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 individual or entity that maintains a position of confidence and duty when handling assets, monetary matters, or legal concerns for another. Fiduciaries are legally and ethically committed to operate in the best interests of the person or organization they are serving, often known as their "principal" or "beneficiary". This duty of loyalty and duty of care is referred to as the fiduciary standard.
Frequent examples of fiduciaries include:
- Trustees — Individuals or entities responsible for handling and overseeing assets held in a trust for the benefit of beneficiaries.
- Executors — Individuals chosen to handle the estate and assets of a deceased person based on their will or the law.
- Financial advisors — Professionals who provide financial advice and oversee investments for clients, with an duty to put first the client's financial goals.
- Corporate directors — Members of a company's board of directors who are assigned the responsibility of making decisions in the best interests of the shareholders.
- Guardians — Individuals appointed by the court to make decisions on behalf of people under 18 or individuals who are incapable to make decisions for themselves.
- Attorneys — Lawyers who are bound by a fiduciary duty to work in the best interests of their clients when managing their legal affairs.
- Real estate agents — Experts who assist 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 important elements to understanding fiduciary duty:
1. Good Faith
Fiduciaries are required to act in "good faith," which means they engage with their clients or beneficiaries with integrity, with sincerity, 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 at the forefront.
2. Duty of Loyalty
Fiduciaries owe a "duty of loyalty" to the client/beneficiary, which means they must prioritize the beneficiary's interests ahead of their own. They ought to eschew any conflicts of interest that might impair their ability to act only in the client's best interests. Any conflicts of interest must be disclosed to the client and the advisor has to still act with the client/beneficiary's interest above 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 informed and considered decisions when managing assets or deciding on behalf of their client or beneficiary. This duty ensures that they strive to safeguard and grow the assets within their care while minimizing risks.
What Is a Fiduciary Financial Advisor in New York City, NY?
Financial advisors help New York City, NY individuals, families, and business owners realize their life goals as they relate to their finances. These services include investment choices, retirement consulting, tax planning, estate planning, asset management and others.
Any individual in New York City, NY 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 have to have qualifications and certifications from industry organizations such as the CFP Board and Fi360. Securing and keeping these certifications require ongoing education and a stringent moral standard.
To illustrate, fiduciary financial advisors with a CERTIFIED FINANCIAL PLANNER™ certification must follow 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 New York City, NY Fiduciaries?
Not all financial advisor in New York City, NY are fiduciaries. The key reason is that financial advisors can work under diverse regulatory frameworks and compensation structures, leading to differentiated standards of care:
- Regulatory framework — Financial advisors can be subject to distinct regulatory oversight relying on their business model. As an example, Registered Investment Advisors (RIAs) are typically fiduciaries. On the other hand, some advisors (for example, those falling under a broker-dealer model) work under the suitability standard, which mandates investments to be appropriate for clients but doesn't require the same duties of loyalty and care.
- Compensation structure — The method financial advisors are compensated can affect their fiduciary status. Fiduciary advisors often charge a proportional charge for their services, rendering their compensation transparent and limiting conflicts of interest. Other advisors typically 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, 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 select investments that a reasonable person would purchase considering an acceptable risk based on the client's goals and investment objective.
The prudent person rule is an early common law principle, and was later unified with the Uniform Prudent Investor Act. Each state can apply their own specific laws. Missouri law, for example, sets out that fiduciary financial advisors must consider:
- Overall economic conditions
- Potential inflation or deflation
- Expected tax implications of investments
- The part that each investment or strategy plays within your portfolio
- Expected return and appreciation of capital
- Other assets and resources you possess
- 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 estimated duration of your relationship with the fiduciary financial advisor
Fiduciary Duty vs. Suitability Standard: What’s the Difference?
Advisors who work under the “suitability rule” are only obligated to suggest investments or products that match your objectives, while advisors with a fiduciary duty must act in your best interest. Here are some key differences:
Fiduciary Duty
- Legal Obligation: Fiduciary financial advisors are legally and ethically bound to operate 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 reveal all conflicts of interest, guarantee transparency, and provide the highest standard of care in their recommendations 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: Financial advisors merely need to ensure that their suggestions are appropriate for the client’s financial requirements and objectives at the time of the transaction.
- Reduced Care Standard: Financial advisors can take into account their own interests as long as the recommendations are suitable.
- Potential Conflicts: 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 suitable for the client.
- Examples: Some broker-dealers and insurance agents.
Best Interest vs. Reasonable Basis
The Investment Advisers Act of 1940 requires that fiduciary advisors must act in their clients' "best interest," while FINRA Rule 2111 stipulates that dealer-brokers and other non-fiduciaries only have a "reasonable basis" for their recommendations. Here's a summary 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 financial advisors to recommend suitable investment products or plans based on provided information. |
| Standard of Care | Superior level of care making sure every action matches with the client's optimal outcome. | Guarantees suggestions are proper and make sense for the client's situation. |
| Client-Centric Approach | Financial advisors prioritize client's goals, needs, and preferences above their own. | Advisors base suggestions on the client's disclosed financial situation, objectives, and risk tolerance. |
| Transparency | Total disclosure of potential conflicts of interest is required. | More relaxed disclosure requirements, as long as the recommendation is appropriate. |
| Due Diligence | Recommendations 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, demanding regular reviews and updates. | Focuses on the suitability of advice at the time of the recommendation, with less focus on ongoing oversight. |
| Conflict of Interest | Must disclose and manage conflicts openly, ensuring clients are aware of potential biases. | Conflicts are less strictly regulated, as long as the suggestion remains suitable. |
| Long-Term Commitment | Financial advisors have a continuous obligation to monitor and update the client's financial plan. | Regular reviews are advised, but the focus is on the suitability of initial suggestions. |
Benefits of Working with a Fiduciary Financial Advisor in New York City, NY
Opting to collaborate with a fiduciary financial advisor in New York City, NY offers an array of advantages that can significantly affect your fiscal health:
- Fiduciary financial advisers are required to act in your best interest and maintain ethical standards
- Total disclosure of pertinent materials and facts and complete transparency concerning issues like risks, fees, and potential conflicts of interest, enabling you to make the best decisions for you and your New York City, NY family
- Make investments on your behalf utilizing their expertise to craft and handle a diversified portfolio that matches your financial goals and risk tolerance
- Thorough financial planning and a well-rounded approach to your financial well-being, evaluating all facets of your financial life to establish a personalized approach
- Consistent monitoring and guidance to ensure your financial tactics and investments stay aligned and that you can adapt to any surprises the market or life presents your way
- Diminished risk with sensible and accountable investment choices done by carefully assessing the risk associated with each investment and modifying your portfolio to align with your risk tolerance
- Assurance that your best interests are being looked after by knowledgeable financial professionals
- A lasting relationship with a fiduciary financial advisor that grasps your financial goals shift over time, and life conditions change
What Financial Planning Services Do Fiduciary Advisors Offer?
At Correct Capital Wealth Management, our comprehensive financial planning services are crafted to offer you with a holistic approach to reaching your financial goals. Our team of fiduciary financial advisors in St. Louis operates diligently to comprehend your unique financial situation and customize strategies that align with 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 formulate a personalized financial roadmap that addresses your short-term needs and long-term objectives.
Financial Portfolio Management
We develop personalized strategies to balance your portfolio, balancing your risk tolerance with your time horizon. Our team consistently monitors and adjusts your investments to align with your financial goals, making sure that your portfolio remains robust and adaptable as market conditions change.
Retirement Planning
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 make certain you can retire securely and securely.
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 reduce your tax liability and improve your overall financial health.
Legacy Planning
We also provide expert guidance on estate planning to help you safeguarding your legacy. From wills and trusts to estate tax strategies, we make certain your assets are passed on according to your wishes while minimizing tax burdens.
Continuous Oversight
Financial planning is not a one-time event but a ongoing process. We provide ongoing monitoring and regular reviews to adapt your financial plan to any shifts in your life circumstances or economic environment.
Client-Centric Approach
At Correct Capital, our approach is highly client-centric. We take pride in building enduring relationships based on trust, transparency, and personalized service. Your financial well-being is our highest priority, and we are committed to helping you attain your financial goals with integrity and excellence.
Other services we offer in New York City, NY include:
- 401(k) Audit
- High-Net-Worth Wealth Management
- Retirement Planner
- Financial Planning
- Retirement Plan Consultants
- Self-Employed Retirement Plans
Choose Correct Capital as Your New York City, NY Fiduciary Financial Advisor
Choosing a financial advisor in New York City, NY with a fiduciary duty is crucial to ensure your money is being put to use how you need it to be. At Correct Capital Wealth Management, we are proud to be fiduciary financial advisors who hold in high regard the financial success and peace of mind of New York City, NY 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 knowledge and qualifications needed 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.
Reach out to us now at 314-930-401(k) or contact us through our website to arrange an appointment and discover how we can assist you achieve your financial goals in New York City, NY.
