The Board of Directors, representatives, and financial advisors comprising NAPFA (The National Association of Personal Financial Advisors) have adopted the following definition of “fiduciary”:
fi-du-ci-ar-y: A financial advisor held to a Fiduciary Standard occupies a position of special trust and confidence when working with a client. As a Fiduciary, the financial advisor is required to act with undivided loyalty to the client. This includes disclosure of how the financial advisor is to be compensated and any corresponding conflicts of interest.
There’s a lot of misunderstanding among consumers about who exactly is-and is not-a fiduciary plan advisor. To separate the two, you must understand the two standards of care and client responsibility in the financial services industry:
Very few financial advisors will accept the liability that comes with a fiduciary standard of care. The fiduciary standard exposes an advisor to a much higher level of responsibility and puts them at greater risks for lawsuits.
Your employees have worked hard for every dime in their 401k or retirement plan. Shouldn’t you require the highest level of care and responsibility—a fiduciary standard of care—from your 401k plan advisor?
We embrace our fiduciary responsibilities to all of our clients in writing, because words are only words until they are backed by a promise with a signature behind it!