Fiduciary financial advisor in Winston-Salem, NC. For those in Winston-Salem, NC who don't have the time, skill, or inclination to oversee their investments and retirement accounts on their own, working with a financial advisor is a great way to help meet their financial goals. Trust is paramount in that relationship, and whether you're planning for retirement, seeking to grow your wealth, or saving for your kids' education, you need a financial advisor who you know will treat you and your money well. By working with a fiduciary financial advisor in Winston-Salem, NC, you'll have a ally who has a legal and ethical obligation to put your own best interests first.
At Correct Capital Wealth Management, our Winston-Salem, NC fiduciary financial advisors will never propose a product, investment, or plan that we do not sincerely trust in ourselves. For financial advisors that adhere to the fiduciary standard and operate with your best interest in mind, reach out to Correct Capital today at 314-930-401(k), contact us through our wesbite, or schedule an appointment with a member of our advisor team.
Schedule a Meeting With an Advisor Today
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.
Schedule a 15-Minute Introductory Call
Understanding Fiduciaries
A fiduciary is a person or organization that maintains a position of trust and duty when managing assets, monetary matters, or legal concerns on behalf of someone else. Fiduciaries are legally and ethically committed to operate in the best interests of the person or entity they are representing, often known as their "principal" or "beneficiary". This duty of loyalty and duty of care is called the fiduciary standard.
Common examples of fiduciaries are:
- Trustees — People or entities charged with managing and monitoring assets held in a trust for the advantage of beneficiaries.
- Executors — Individuals appointed to oversee the estate and assets of a deceased person as per their will or the law.
- Financial advisors — Professionals who provide financial advice and handle investments for clients, with an obligation to prioritize the client's financial well-being.
- Corporate directors — Representatives of a company's board of directors who are given the responsibility of making decisions in the best interests of the shareholders.
- Guardians — People appointed by the court to make decisions on behalf of underage individuals or people who are not able 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 dealing with legal matters.
- Real estate agents — Specialists who assist 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 vital facets 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 with integrity, with genuine intention, and without any intention to mislead or damage the interests of their beneficiaries. They must always 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 client/beneficiary, which means they must put first the beneficiary's interests ahead of their own. They should avoid any conflicts of interest that might compromise their capacity to act only in the beneficiary's best interests. Any conflicts of interest need to be disclosed to the client and the advisor has to still act with the beneficiary's interest over 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 apply in comparable circumstances. They must make informed and careful decisions when managing assets or making decisions on behalf of their client. This duty ensures that they strive to protect and increase the assets within their care while mitigating risks.
What Is a Fiduciary Financial Advisor in Winston-Salem, NC?
Financial advisors help Winston-Salem, NC individuals, families, and business owners achieve their life goals by means of a range of financial services and recommendations. These services consist of investment strategies, retirement planning, tax planning, estate planning, portfolio management and others.
Any individual in Winston-Salem, NC 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 qualifications and certifications from industry organizations such as the CFP Board and Fi360. Obtaining and maintaining these certifications demand continuous education and a rigorous moral standard.
As an example, 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 Winston-Salem, NC Fiduciaries?
Not all financial advisor in Winston-Salem, NC is fiduciaries. The key reason lies in the fact that financial advisors can work under different regulatory frameworks and compensation structures, leading to divergent standards of care:
- Regulatory framework — Financial advisors can be subject to different regulatory oversight depending on their business model. As an example, Registered Investment Advisors (RIAs) are usually fiduciaries. On the other hand, some advisors (for example, those within a broker-dealer model) work under the suitability standard, which demands advice to be fitting 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 usually charge a percentage fee for their services, making their compensation open and minimizing conflicts of interest. Other advisors generally receive commissions or other forms of compensation tied to product sales, which means they may make recommendations that are more in their interest than yours.
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 cannot predict the future or determine which investments will be profitable with 100% certainty, but mandates that a fiduciary financial advisor select investments that a prudent person would purchase considering 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 may apply their own unique laws. Missouri law, for example, mandates that fiduciary financial advisors must consider:
- General economic conditions
- Potential inflation or deflation
- Expected tax implications 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 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 anticipated duration of your relationship with the fiduciary financial advisor
Fiduciary Duty vs. Suitability Standard: What’s the Difference?
Advisors who operate under the “suitability standard” are only obligated to suggest investment products or products that match your objectives, while financial advisors with a fiduciary duty must operate in your best interest. Here are some important differences:
Fiduciary Duty
- Ethical Obligation: Fiduciary financial advisors are lawfully and morally bound to act in their clients' best interests at all times.
- Best Interest: Financial advisors must prioritize the client's financial health over their own profit.
- Comprehensive Care: They must reveal all conflicts of interest, ensure transparency, and deliver the highest standard of care in their recommendations 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
- Suitability: Advisors only need to ensure that their suggestions are appropriate for the client’s financial needs and objectives at the time of the transaction.
- Lower Standard of Care: Advisors can consider their own interests as long as the suggestions are appropriate.
- Possible Conflicts: Financial advisors may receive commissions from the sale of financial products, which can create conflicts of interest.
- Governance: Governed by the Financial Industry Regulatory Authority (FINRA), which mandates a “reasonable basis” that an investment is suitable for the client.
- Instances: 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 stipulates that dealer-brokers and other non-fiduciaries simply have a "reasonable basis" for their recommendations. Here's a summary of what those terms mean in relation to handling a client's investments and financial planning:
| Best Interest | Reasonable Belief | |
|---|---|---|
| Definition | Requires financial advisors to act in the client's most favorable financial interest. | Mandates financial advisors to recommend appropriate products or plans based on provided information. |
| Standard of Care | Higher level of care ensuring every action conforms with the client's most favorable outcome. | Makes certain suggestions are appropriate and make sense for the client's situation. |
| Client-Centric Approach | Financial advisors focus on client's goals, needs, and preferences above their own. | Advisors base suggestions on the client's stated financial situation, objectives, and risk tolerance. |
| Transparency | Complete disclosure of potential conflicts of interest is necessary. | Looser disclosure requirements, as long as the suggestion is proper. |
| Due Diligence | Recommendations 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, demanding regular reviews and updates. | Emphasizes the appropriateness of advice at the time of the recommendation, with minimal focus on ongoing oversight. |
| Conflict of Interest | Must disclose and handle conflicts openly, 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 adjust the client's financial plan. | Regular reviews are advised, but the focus is on the suitability of initial recommendations. |
Benefits of Working with a Fiduciary Financial Advisor in Winston-Salem, NC
Choosing to partner with a fiduciary financial advisor in Winston-Salem, NC provides an array of benefits that can deeply impact your fiscal health:
- Fiduciary financial advisers are required to act in your best interest and uphold high standards
- Full disclosure of essential 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 Winston-Salem, NC family
- Manage investments on your behalf by employing their expertise to create and oversee a diversified portfolio that aligns with your financial goals and risk tolerance
- Comprehensive financial planning and a well-rounded approach to your financial well-being, taking into account all facets of your financial life to devise a personalized approach
- Ongoing monitoring and advice to ensure your financial tactics and investments remain on track and that you can modify to any surprises the market or life throws your way
- Diminished risk with prudent and responsible investment choices taken by thoroughly assessing the risk associated with each investment and shaping your portfolio to match your risk tolerance
- Assurance that your best interests are being cared for by knowledgeable financial professionals
- A long-term relationship with a fiduciary financial advisor that understands your financial goals evolve over time, and life situations alter
What Financial Planning Services Do Fiduciary Advisors Offer?
At Correct Capital Wealth Management, our holistic financial planning services are crafted to provide you with a holistic approach to meeting your financial goals. Our team of fiduciary financial advisors in St. Louis operates diligently to understand your unique financial situation and tailor strategies that align with your life aspirations.
Tailored Financial Roadmap
We begin by undertaking a detailed analysis of your current financial status, including income, expenses, assets, and liabilities. This helps us create a personalized financial roadmap that addresses your short-term needs and long-term objectives.
Financial Portfolio Management
We create personalized strategies to balance your portfolio, balancing your risk tolerance with your time horizon. Our team consistently monitors and adjusts your investments to match your financial goals, making sure that your portfolio remains robust and adaptable as market conditions change.
Retirement Planning
Planning for retirement is a key element of our comprehensive financial planning. We assist you in navigating the complexities of retirement accounts, social security benefits, and income strategies to ensure you can retire comfortably and safely.
Tax Planning
Effective tax planning helps keep your hard-earned money with yourself and your loved ones. Our advisors are expert in tax laws and strategies that can reduce your tax liability and enhance your overall financial health.
Estate Planning
We also deliver informed guidance on estate planning to help you protecting your legacy. From wills and trusts to estate tax strategies, we guarantee your assets are passed on according to your wishes while lowering tax burdens.
Ongoing Monitoring and Adjustments
Financial planning is not a once-off event but a ongoing process. We provide ongoing monitoring and routine reviews to adapt your financial plan to any alterations in your life circumstances or economic environment.
Client-Centric Approach
At Correct Capital, our approach is highly client-centric. We pride ourselves on 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 achieve your financial goals with integrity and excellence.
Other services we offer in Winston-Salem, NC 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 Winston-Salem, NC Fiduciary Financial Advisor
Choosing a financial advisor in Winston-Salem, NC with a fiduciary standard is vital 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 hold in high regard the financial success and peace of mind of Winston-Salem, NC 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 skills and qualifications necessary 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 online to arrange an appointment and discover how we can help you achieve your financial goals in Winston-Salem, NC.
