Fiduciary financial advisor in Swansea, IL. For Swansea, IL residents who don't have the free time, knowledge, or interest to oversee 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 manage your wealth, or saving for your kids' education, the knowledge, skill, and integrity of your financial advisor matter greatly. By working with a fiduciary financial advisor in Swansea, IL, you'll gain a partner who is legally and ethically committed to put your own best interests first.
At Correct Capital Wealth Management, our Swansea, IL fiduciary financial advisors will never suggest a product, investment, or approach that we don't sincerely believe in ourselves. For financial advisors that uphold the fiduciary standard and work with your best interest in mind, get in touch with Correct Capital today at 314-930-401(k), fill out our online form, or schedule an appointment with a member of our advisor team.
A fiduciary is a person or organization that occupies a role of trust and responsibility when managing assets, finances, or legal affairs for another person. Fiduciaries are legally and ethically obliged to work in the best interests of the person or organization 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 include:
- Trustees — Individuals or entities charged with managing and monitoring assets held in a trust for the benefit of beneficiaries.
- Executors — Individuals designated to manage the estate and assets of a decedent based on their will or the law.
- Financial advisors — Professionals who give financial advice and oversee investments for clients, with an duty to put first the client's financial goals.
- Corporate directors — Representatives of a company's board of directors who are bound to shareholders to try and increase their profit.
- Guardians — Individuals 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 committed by a fiduciary duty to act in the best interests of their clients when handling their cases.
- Real estate agents — Specialists who assist 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 important facets 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 sincerity, and without any design to mislead or damage the interests of their beneficiaries. They must continually 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 beneficiary, which means they must prioritize the beneficiary's interests above their own. They ought to steer clear of any conflicts of interest that might compromise their capability to act exclusively in the beneficiary's best interests. All conflicts of interest must be disclosed to the client or beneficiary and the advisor needs to still act with the beneficiary's interest above their own.
3. Duty of Care
Fiduciaries have a "duty of care" to apply the standard of care, skill, and diligence that a judicious person would employ in the same or similar situations. They must make informed and thoughtful decisions when overseeing assets or making decisions on behalf of their client. This duty guarantees that they do their best to protect and grow the assets under their care while minimizing risks.
What Is a Fiduciary Financial Advisor in Swansea, IL?
Financial advisors help Swansea, IL individuals, families, and business owners attain their life goals as they relate to their finances. These services comprise investment recommendations, retirement consulting, tax planning, estate planning, portfolio management and more.
Any individual in Swansea, IL can give themselves the title of "financial advisor," but to be a fiduciary, an advisor needs qualifications and certifications from industry organizations such as the CFP Board and Fi360. Achieving and keeping these certifications require ongoing education and a rigorous moral standard.
For instance, 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 Swansea, IL Fiduciaries?
Not all financial advisor in Swansea, IL are fiduciaries. The main reason lies in the fact 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 relying on their business model. As an example, Registered Investment Advisors (RIAs) are usually fiduciaries. On the other hand, some advisors (for example, those falling under a broker-dealer model) operate under the suitability standard, which requires advice to be suitable for clients but does not mandate the same level of fiduciary duty.
- Compensation structure — The way financial advisors are compensated can affect their fiduciary status. Fiduciary advisors usually charge a percentage fee for their services, rendering their compensation transparent 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 are required to 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 with 100% certainty, but mandates that a fiduciary financial advisor purchase investments that a sensible person would purchase based on 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 might apply their own unique laws. Missouri law, for example, mandates that fiduciary financial advisors must consider:
- General economic conditions
- Possible inflation or deflation
- Expected tax consequences of investments
- The role that each investment or approach plays within your portfolio
- Expected return and appreciation of capital
- Other assets and resources you possess
- 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 anticipated duration of your relationship with the fiduciary financial advisor
Benefits of Working with a Fiduciary Financial Advisor in Swansea, IL
Opting to collaborate with a fiduciary financial advisor in Swansea, IL brings to the table an array of advantages that can deeply impact your financial health:
- Fiduciary financial advisers are required to act in your best interest and adhere to high standards
- Complete disclosure of relevant materials and facts and complete transparency with matters like risks, fees, and potential conflicts of interest, permitting you to make the best decisions for you and your Swansea, IL family
- Handle investments on your behalf by leveraging their expertise to craft and oversee a diversified portfolio that matches your financial goals and risk tolerance
- Thorough financial planning and a full approach to your financial well-being, evaluating all facets of your financial life to establish a tailored approach
- Ongoing monitoring and guidance to guarantee your financial strategies and investments stay aligned and that you can adapt to any surprises the market or life gives your way
- Diminished risk with wise and responsible investment choices done by meticulously assessing the risk linked with each investment and tailoring your portfolio to align with your risk tolerance
- Assurance that your best interests are being looked after by skilled financial professionals
- A prolonged relationship with a fiduciary financial advisor that understands your financial goals shift over time, and life scenarios modify
Hire Correct Capital as Your Swansea, IL Fiduciary Financial Advisor
Choosing a financial advisor in Swansea, IL with a fiduciary duty is essential to guarantee your long-term interests stay 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 Swansea, IL residents and business owners equally. Our team is comprised of CERTIFIED FINANCIAL PLANNER™ (CFP®) professionals and we are a Registered Investment Advisor (RIA) with the expertise 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.