Make Sure You Hear This F-Word Before Hiring a Financial Advisor

The NRI report summary showed that among more than 1,000 adult parents, only 27% choose to work with a financial professional, compared to nearly 60% who rely on friends and family.

One factor contributing to the low percentage of US adults working with financial professionals has been a fear of being scammed by an unscrupulous advisor.

While the risk of encountering fraudsters in any industry can never be fully eliminated, you can significantly increase your odds of finding a trustworthy financial professional by hiring a fiduciary advisor or planner. 

In short, fiduciary financial advisors must, by law, recommend the best investment solutions for their clients. However, it is not enough that a product is “suitable.” A higher standard applies to a fiduciary advisor.

What Is a Fiduciary Financial Advisor?

Before you hire an advisor, you should ask if they will always act in your best interest as a fiduciary. Fortunately, you can easily find fiduciary financial advisors today if you know what to look for and how to ask the right questions.

One way you can be sure your financial advisor will act as a fiduciary includes hiring a Certified Financial Planner, often referred to as a CFP.

Certified Financial Planners (CFP) are Fiduciaries

Upon earning the Certified Financial Planner designation, each CFP acknowledges they will adhere to the CFP Board's Code of Ethics and Standards of Conduct and act as a fiduciary when providing financial advice to their clients.

A fiduciary advisor must act solely in the client's best interests. They agree to put the client's financial circumstances above their own. With so many opaque investment products available these days, working with a fiduciary is more critical than ever.

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