All financial advisors are required to give advice and recommendations that are considered “suitable” to their clients. However, fiduciary advisors are held to an even greater standard. As a fiduciary, they are required by law to not just meet suitability standards, but to above all, place the client’s best interests ahead of their own and even ahead of their employer’s. Before engaging in a partnership with an advisor or firm it is important to do your due diligence to determine if they are registered as a fiduciary standard.
Questions to ask when evaluating a financial advisor:
- Are you subject to a fiduciary standard of care?
- How are you compensated? Is any of your revenue generated based on the types of investments that you recommend?
- Is your firm committed to the fiduciary standard of care? How long has your firm been following this standard?
- Do you or your firm have any potential conflicts of interest in providing financial advice to clients?
One of the easiest ways to determine if a financial advisor is a fiduciary, outside of simply asking, is to note whether or not they have any professional designations. The following designations are governed by different agencies:
Certified Financial Professionals (CFPs) are held to a fiduciary standard by the CFP Board of Standards. CFP fiduciary standards apply to a broad scope of financial planning, including retirement, tax, and insurance advice. This standard is not enforced by a government agency, such as the SEC or DOL.
Chartered Financial Consultants (ChFCs) are held to a fiduciary standard by the American College of Financial Services’ Code of Ethics. The ChFC designation covers the same core curriculum covered by the CFP designation plus additional electives that focus on areas of personal finance.
Accredited Investment Fiduciary (AIF) is a designation issued by the Center for Fiduciary studies. It requires designees not only to be fiduciaries, but also to prove knowledge of fiduciary rules and to engage in ongoing education.
Why having a Fiduciary Advisor matters?
A fiduciary advisor is required to provide full transparency on services provided and compensation received. One of the primary defining structures of a fiduciary advisor is the fee structure in which they operate, known as “fee-only.” A fee-only advisor is compensated through advice for their clients, management of financial assets, and carrying our financial planning. They are not compensated on a commission structure based on specific investment product choices, which allow them to remain objective and avoid conflicts of interest.
Is Strategic Financial Services a Fiduciary?
Yes. Strategic has actively taken measures to eliminate all conflicts of interest including being a 100% fee-based advisor. This has allowed us to place our client’s best interests above all. We work to formulate long-term strategies for every client, taking into account their goals, risk tolerances, and financial and personal circumstances. We have numerous employees who hold the Certified Financial Professional’s (CFPs) designation who are governed by the CFP Board of Standards to uphold this fiduciary responsibility.
About Strategic
Founded in 1979, Strategic is a leading investment and wealth management firm managing and advising on client assets of over $2 billion.
OverviewDisclosures
Strategic Financial Services, Inc. is a SEC-registered investment advisor. The term “registered” does not imply a certain level of skill or training. “Registered” means the company has filed the necessary documentation to maintain registration as an investment advisor with the Securities and Exchange Commission.
The information contained on this site is for informational purposes and should not be considered investment advice or a recommendation of any particular security, strategy or investment product. Every client situation is different. Strategic manages customized portfolios that seek to properly reflect the particular risk and return objectives of each individual client. The discussion of any investments is for illustrative purposes only and there is no assurance that the adviser will make any investments with the same or similar characteristics as any investments presented. The investments identified and described do not represent all of the investments purchased or sold for client accounts. Any representative investments discussed were selected based on a number of factors including recent company news or earnings release. The reader should not assume that an investment identified was or will be profitable. All investments contain risk and may lose value. There is no assurance that any investments identified will remain in client accounts at the time you receive this document.
Some of the material presented is based upon forward-looking statements, information and opinions, including descriptions of anticipated market changes and expectations of future activity. Strategic Financial Services believes that such statements, information, and opinions are based upon reasonable estimates and assumptions. However, forward-looking statements, information and opinions are inherently uncertain and actual events or results may differ materially from those reflected in the forward-looking statements. Therefore, undue reliance should not be placed on such forward-looking statements, information and opinions.
No content on this website is intended to provide tax or legal advice. You are advised to seek advice on these matters from separately retained professionals.
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