Advisor basics
fiduciary
A fiduciary is a professional the law requires to act in the client's best interest and not put their own interest first. Registered investment advisers owe this duty to their clients.
A fiduciary is someone who must put your interest ahead of their own. For investment advisers, the SEC says the duty means an adviser must serve the best interest of the client at all times and not subordinate the client's interest to its own.
For example: an adviser could earn more by steering you to Product A, but Product B fits your goals better. A fiduciary must disclose the conflict and still act in your best interest.
The duty has two parts: care and loyalty. Care means advice that fits your goals. Loyalty means no hidden conflicts. Not every financial professional carries the same duty, so ask. Seek First answers the question this way on its site: "Are you a fiduciary? Yes."
For a Christian family, this matters because stewardship starts with trust. You hand someone the full picture of your giving, taxes, investments and estate. You want to know the law holds them to a clear standard. A fiduciary duty is not a promise of any result. It is a duty of conduct.
To see how fiduciary, fee-only and fee-based differ, read our comparison of fiduciary, fee-only and fee-based advisors.
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