Fiduciary financial advisor in Webster Groves, MO. For Webster Groves, MO residents who lack the time, knowledge, or inclination to manage their assets and retirement accounts on their own, partnering with a financial advisor is a great way to help meet their financial goals. That relationship is built on trust, and whether you're planning for retirement, looking to grow your wealth, or saving for your kids' education, the knowledge, skill, and honesty of your financial advisor matter greatly. By choosing a fiduciary financial advisor in Webster Groves, MO, you'll have a partner who is legally and ethically obliged to put your own best interests first.
At Correct Capital Wealth Management, our Webster Groves, MO fiduciary financial advisors will never propose a solution, investment, or strategy that we do not truly trust in ourselves. For financial advisors that follow the fiduciary standard and act with your best interest as their top priority, reach out to Correct Capital today at 877-930-4015, fill out our online form, or schedule an appointment with on of our advisors.
What Is a Fiduciary?
A fiduciary is a individual or entity that maintains a role of confidence and responsibility when handling assets, monetary matters, or legal affairs on behalf of someone else. Fiduciaries are legally and ethically obliged to act in the best interests of the person 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.
Frequent examples of fiduciaries are:
- Trustees — People or entities charged with managing and overseeing assets held in a trust for the benefit of beneficiaries.
- Executors — Individuals chosen to manage the estate and assets of a deceased person as per their will or the law.
- Financial advisors — Professionals who provide financial advice and manage investments for clients, with an responsibility to prioritize the client's financial well-being.
- Corporate directors — Members of a company's board of directors who are bound to shareholders to try and increase their profit.
- Guardians — People chosen by the court to make decisions on behalf of underage individuals or individuals who are unable to make decisions for themselves.
- Attorneys — Lawyers who are bound by a fiduciary duty to work in the best interests of their clients when handling legal matters.
- Real estate agents — Experts who assist clients in purchasing, 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 aspects to understanding fiduciary duty:
1. Good Faith
Fiduciaries have an obligation 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 infringe upon the interests of their beneficiaries. They must consistently act with integrity and with the best interests of the clients in mind.
2. Duty of Loyalty
Fiduciaries owe a "duty of loyalty" to the client/beneficiary, which means they must put first the beneficiary's interests over their own. They must eschew any conflicts of interest that might jeopardize their capability to act solely in the client's best interests. All conflicts of interest need to be revealed to the client or beneficiary and the advisor has to still act with the beneficiary's interest above their own.
3. Duty of Care
Fiduciaries have a "duty of care" to apply the degree of care, skill, and diligence that a judicious person would employ in similar circumstances. They must make informed and considered decisions when managing assets or making decisions on behalf of their client. This duty guarantees that they strive to safeguard and grow the assets within their care while minimizing risks.
What Is a Fiduciary Financial Advisor in Webster Groves, MO?
Financial advisors help Webster Groves, MO individuals, families, and business owners realize their life goals as they relate to their finances. These services comprise investment choices, retirement planning, tax planning, estate planning, asset management and others.
Any person in Webster Groves, MO 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. Securing and maintaining these certifications require continuous education and a strict moral standard.
To illustrate, fiduciary financial advisors with a CERTIFIED FINANCIAL PLANNER™ certification need to 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 Webster Groves, MO Fiduciaries?
Not all financial advisor in Webster Groves, MO is fiduciaries. The main reason is that financial advisors can operate under different regulatory frameworks and compensation structures, leading to differentiated standards of care:
- Regulatory framework — Financial advisors might be subject to various regulatory frameworks depending on their business model. For example, Registered Investment Advisors (RIAs) are typically fiduciaries. On the other hand, some advisors (for example, those falling under a broker-dealer model) function under the suitability standard, which demands recommendations to be appropriate for clients but does not mandate 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 proportional charge for their services, rendering their compensation transparent and minimizing conflicts of interest. Other advisors generally receive commissions or different kinds of compensation linked 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 can't predict the future or know which investments will be profitable with 100% certainty, but mandates that a fiduciary financial advisor go for investments that a reasonable person would purchase from an acceptable risk considering the client's goals and investment objective.
The prudent person rule has its origins in in common law, and was subsequently unified with the Uniform Prudent Investor Act. Each state might apply their own specific laws. Missouri law, for example, mandates that fiduciary financial advisors must consider:
- Overall 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
- Additional assets and resources you possess
- Your needs for readily available funds, income, and preservation of capital
- An asset's unique 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
Benefits of Working with a Fiduciary Financial Advisor in Webster Groves, MO
Opting to collaborate with a fiduciary financial advisor in Webster Groves, MO brings to the table an array of advantages that can profoundly influence your financial health:
- Fiduciary financial advisers must act in your best interest and adhere to ethical standards
- Complete disclosure of relevant materials and facts and complete transparency regarding matters like risks, fees, and potential conflicts of interest, enabling you to make the best decisions for you and your Webster Groves, MO family
- Manage investments on your behalf by leveraging their expertise to create and manage a diversified portfolio that resonates with your financial goals and risk tolerance
- Complete financial planning and a well-rounded approach to your financial well-being, taking into account all facets of your financial life to establish a personalized approach
- Ongoing monitoring and guidance to guarantee your financial tactics and investments continue to be in line and that you can adapt to any curveballs the market or life throws your way
- Diminished risk with wise and judicious investment choices done by thoroughly assessing the risk linked with each investment and modifying your portfolio to align with your risk tolerance
- Peace of mind that your best interests are being watched over by knowledgeable financial professionals
- A long-term relationship with a fiduciary financial advisor that comprehends your financial goals change over time, and life situations change
Choose Correct Capital as Your Webster Groves, MO Fiduciary Financial Advisor
Selecting a financial advisor in Webster Groves, MO with a fiduciary duty is crucial to guarantee your long-term interests stay protected. At Correct Capital Wealth Management, we are honored to be fiduciary financial advisors who hold in high regard the financial success and peace of mind of Webster Groves, MO 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 expertise and qualifications essential to lead you on your financial journey. We provide 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 877-930-4015 or contact us online to set up an appointment and learn more about how we can assist you attain your financial goals in Webster Groves, MO.
