Fiduciary financial advisor in Yonkers, NY. For those in Yonkers, NY who don't have the free time, expertise, or interest to manage their assets and retirement accounts themselves, partnering with a financial advisor is a great way to help meet their financial goals. Trust is crucial in that relationship, and whether you're planning for retirement, looking to manage your wealth, or ensuring a secure financial future for your family, the knowledge, skill, and integrity of your financial advisor matter greatly. By working with a fiduciary financial advisor in Yonkers, NY, you'll have a confidante who has a legal and ethical responsibility to put your own best interests first.
At Correct Capital Wealth Management, our Yonkers, NY fiduciary financial advisors won't ever suggest a product, investment, or strategy that we do not sincerely trust in ourselves. For financial advisors that uphold the fiduciary standard and act with your best interest in mind, call Correct Capital now at 314-930-401(k), contact us online, or schedule a meeting with a member of our advisor team.
What Is a Fiduciary?
A fiduciary is a individual or organization that occupies a position of confidence and duty when managing assets, finances, or legal concerns on behalf of someone else. Fiduciaries are legally and ethically obliged to act in the best interests of the person or organization they are representing, often referred to as their "principal" or "beneficiary". This duty of loyalty and duty of care is known as the fiduciary standard.
Typical examples of fiduciaries include:
- Trustees — Individuals or entities charged with managing and overseeing assets held in a trust for the gain of beneficiaries.
- Executors — People designated to handle the estate and assets of a deceased person as per their will or the law.
- Financial advisors — Professionals who offer financial advice and handle investments for clients, with an responsibility to emphasize the client's financial goals.
- Corporate directors — Representatives of a company's board of directors who are given making decisions in the best interests of the shareholders.
- Guardians — People appointed by the court to make decisions on behalf of minors or individuals who are unable to make decisions for themselves.
- Attorneys — Lawyers who are bound by a fiduciary duty to operate in the best interests of their clients when handling legal matters.
- Real estate agents — Experts who help 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 important aspects to understanding fiduciary duty:
1. Good Faith
Fiduciaries are mandated to act in "good faith," which means they interact with their clients or beneficiaries with integrity, with sincerity, and without any aim to deceive or harm 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 client/beneficiary, which means they must prioritize the beneficiary's interests over their own. They should steer clear of any conflicts of interest that might jeopardize their ability 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 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 apply in the same or similar situations. They must make informed and careful decisions when handling assets or making decisions on behalf of their client or beneficiary. This duty guarantees that they work diligently to protect and increase the assets within their care while mitigating risks.
What Is a Fiduciary Financial Advisor in Yonkers, NY?
Financial advisors help Yonkers, NY individuals, families, and business owners achieve their life goals as they relate to their finances. These services consist of investment strategies, retirement consulting, tax planning, estate planning, asset management and others.
Anyone in Yonkers, NY can call themselves a "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 must possess credentials and certifications from industry organizations such as the CFP Board and Fi360. Obtaining and maintaining these certifications necessitate continuous education and a stringent 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 Yonkers, NY Fiduciaries?
Not all financial advisor in Yonkers, NY are fiduciaries. The key reason is that financial advisors can function under various regulatory frameworks and compensation structures, resulting to differentiated standards of care:
- Regulatory framework — Financial advisors might be subject to different regulatory frameworks relying on their business model. For example, Registered Investment Advisors (RIAs) are typically fiduciaries. Conversely, some advisors (for example, those within a broker-dealer model) function under the suitability standard, which demands investments to be suitable for clients but does not mandate the same level of fiduciary duty.
- Compensation structure — The way financial advisors are compensated can influence their fiduciary status. Fiduciary advisors typically charge a proportional charge for their services, making their compensation transparent and minimizing conflicts of interest. Non-fiduciary advisors usually receive commissions or other forms of compensation linked to product sales, which means they may make recommendations that are more in their interest than yours.
The Prudent-Person Rule
Fiduciary financial advisors must abide by the Prudent-Person Rule, often known as the prudent investor rule. The rule acknowledges that financial advisors cannot predict the future or know which investments will be profitable ahead of time, but stipulates that a fiduciary financial advisor purchase investments that a reasonable person would purchase from an acceptable risk based on the client's goals and investment objective.
The prudent person rule has its origins in in common law, and was eventually unified with the Uniform Prudent Investor Act. Each state may apply their own particular laws. Missouri law, for example, stipulates that fiduciary financial advisors must consider:
- Overall economic conditions
- Potential inflation or deflation
- Expected tax consequences of investments
- The part that each investment or strategy 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 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
Fiduciary Duty vs. Suitability Standard: What’s the Difference?
Advisors who work under the “suitability standard” are merely required to suggest investment products or financial products that align with your objectives, while financial advisors with a fiduciary duty must operate in your best interest. Here are some key differences:
Fiduciary Duty
- Ethical Obligation: Fiduciary financial advisors are lawfully and morally bound to operate in their clients' best interests at all times.
- Client's Best Interest: Financial advisors must focus on the client's financial health over their own profit.
- Full Disclosure: They must reveal all conflicts of interest, guarantee transparency, and provide the highest standard of care in their advice and actions.
- Governance: 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
- Suitability: Financial advisors only need to ensure that their suggestions are suitable for the client’s financial requirements and objectives at the time of the transaction.
- Reduced Care Standard: Financial advisors can consider their own interests as long as the recommendations are appropriate.
- Possible Conflicts: Advisors may earn 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 appropriate for the client.
- Instances: Some broker-dealers and insurance agents.
Best Interest vs. Reasonable Basis
The Investment Advisers Act of 1940 mandates that fiduciary advisors must act in their clients' "best interest," while FINRA Rule 2111 mandates 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 managing a client's investments and financial planning:
| Best Interest | Reasonable Belief | |
|---|---|---|
| Definition | Mandates financial advisors to act in the client's optimal financial interest. | Requires financial advisors to recommend suitable investment products or strategies based on available information. |
| Standard of Care | Elevated level of care ensuring every action conforms with the client's optimal outcome. | Ensures recommendations are suitable and make sense for the client's circumstances. |
| Client-Centric Approach | Advisors prioritize client's objectives, needs, and preferences above their own. | Advisors base recommendations on the client's disclosed financial situation, objectives, and risk tolerance. |
| Transparency | Complete disclosure of potential conflicts of interest is necessary. | Less stringent disclosure requirements, so long as the suggestion is suitable. |
| 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, necessitating regular reviews and updates. | Stresses the appropriateness of advice at the time of the recommendation, with minimal focus on ongoing oversight. |
| Conflict of Interest | Must reveal and handle conflicts openly, ensuring clients are aware of potential biases. | Conflicts are more loosely governed, as long as the recommendation remains suitable. |
| Long-Term Commitment | Financial advisors have a continuous obligation to oversee and update the client's financial plan. | Periodic reviews are advised, but the focus is on the suitability of initial suggestions. |
Benefits of Working with a Fiduciary Financial Advisor in Yonkers, NY
Choosing to partner with a fiduciary financial advisor in Yonkers, NY offers an array of advantages that can profoundly affect your monetary health:
- Fiduciary financial advisers are required to act in your best interest and maintain ethical standards
- Total disclosure of pertinent materials and facts and full transparency concerning issues like risks, fees, and potential conflicts of interest, allowing you to make the best decisions for you and your Yonkers, NY family
- Manage investments on your behalf utilizing their expertise to develop and manage a diversified portfolio that matches your goals and strategies
- Thorough financial planning and a holistic approach to your financial well-being, evaluating all facets of your financial life to create a tailored approach
- Continuous monitoring and direction to guarantee your financial strategies and investments remain on track and that you can modify to any surprises the market or life presents your way
- Minimized risk with prudent and judicious investment choices taken by meticulously assessing the risk associated with each investment and modifying your portfolio to align with your risk tolerance
- Relief that your best interests are being watched over by skilled financial advisors
- A long-term relationship with a fiduciary financial advisor that grasps your financial goals change over time, and life situations change
What Financial Planning Services Do Fiduciary Advisors Offer?
At Correct Capital Wealth Management, our holistic financial planning services are created to offer you with a holistic approach to reaching your financial goals. Our team of fiduciary financial advisors in St. Louis functions diligently to comprehend your unique financial situation and customize strategies that align with your life aspirations.
Customized Financial Roadmap
We begin by conducting a detailed analysis of your current 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.
Investment Portfolio Management
We create personalized strategies to balance your portfolio, balancing your risk tolerance with your time horizon. Our team regularly monitors and adjusts your investments to meet your financial goals, ensuring that your portfolio remains robust and adaptable to changing market conditions.
Retirement Planning
Planning for retirement is a key element of our comprehensive financial planning. We help you navigate 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 out of Uncle Sam's hands. 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 informed guidance on estate planning to help you safeguarding your legacy. From wills and trusts to estate tax strategies, we ensure your assets are allocated according to your wishes while minimizing tax burdens.
Ongoing Monitoring and Adjustments
Financial planning is not a once-off event but a ongoing process. We offer ongoing monitoring and routine reviews to adjust your financial plan to any shifts in your life circumstances or economic environment.
Client-Focused Strategy
At Correct Capital, our approach is deeply client-centric. We take pride in building lasting 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 Yonkers, NY include:
Choose Correct Capital as Your Yonkers, NY Fiduciary Financial Advisor
Choosing a financial advisor in Yonkers, NY with a fiduciary standard is vital to ensure your money is being put to use how you need it to be. At Correct Capital Wealth Management, we are pleased to be fiduciary financial advisors who place at the forefront the financial success and peace of mind of Yonkers, NY residents and business owners equally. Our team includes CERTIFIED FINANCIAL PLANNER™ (CFP®) professionals and we are a Registered Investment Advisor (RIA) with the skills and qualifications essential 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.
Contact us today at 314-930-401(k) or contact us through our website to schedule an appointment and find out more about how we can help you reach your financial goals in Yonkers, NY.
