One may have seen the word "fiduciary" in the news or even on our website. What does this word mean and why is it important to you? As a recent article (Kiplinger.com, "Is Your Financial Planner Acting in Your Best Interest?") states "At a high level, the term “fiduciary” means to always put the client’s interest first. When working with a financial adviser, many people assume that’s always the case. However, that’s not always true."
Putting the client's interest first should always be the case. But as stated above, not all financial professionals must do that. At Family First Financial Planning, we must as we are required to be fiduciaries due to both our registration as Investment Advisor representatives and our Certified Financial Planning™ designation. Others in the industry may only be subject to a suitability or best interest standard which do not always require putting the client's interests first. And to confuse clients more, some advisers are dually registered and may wear one hat where they are required to be fiduciaries and then not have to when wearing another hat.
When I founded the firm twenty-three years ago, I didn't know the word or standard of fiduciary. What I did know was that all clients deserve financial advice that is best for them and unique to their own circumstances. I did not want to be compensated through selling products that might encourage me to sell more for commission versus finding the right tools for the client. I remember once working in the bank and asking a fellow broker about which money market mutual fund was the best for the client. I was told to not even bother as I would make no commission on that product and to instead direct the client to other investments. I knew what was best for the client so I ignored the broker and did the research on my own. Perhaps financially she would have a better chance at higher returns in the market. But she also wanted to have liquidity and not have high risk. I often say, "There is a financial answer and then there is an answer that is right for you." This was the case with this client and many more.
I named the firm Family First as I had just had my first child. But family means my clients also. Once you become a client of Family First, you are family. And we are proud to put your interests first and act as fiduciaries to you. Family is first. - Leslie Trowbridge, CFP®