Frequently Asked Questions

The fiduciary obligations of RIAs to their clients are extensive.  They must:

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1.  Provide investment advice that is entirely disinterested, objective, and in the client's best interest.

2.  Always put the interest of their clients above their own.

3.  Always act toward clients with loyalty, fairness, and good faith.

4.  Disclose any actual or potential conflicts of interest in filings with the SEC.

5.  Seek best execution of all trades.

6.  Monitor the accounts of their clients during their relationship.

7.  Keep all matters relating to clients in strict confidence.

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No they are not.  All RIA’s (Registered Investment Advisors) are fiduciaries. However, broker-dealers, a broader term used to describe a person or firm that buys and sells securities on behalf of a client and their organization, aren't uniformly held to a fiduciary standard (this applies to banks and insurance companies as well). Instead, broker-dealers must follow a “suitability” standard, which means they must “reasonably believe” that an investment, transaction, or the frequency of trades is “suitable” for the customer.

Broker-dealers may be incentivized to sell investment products that pay them a higher commission instead of lower-cost investments.  As long as the broker-dealer “reasonably believes” the higher-cost product is “suitable,” this is permissible conduct.  

An RIA would violate the fiduciary duty to clients by engaging in this conduct.

The obligation of broker-dealers to disclose potential conflicts of interest is more relaxed than it is with RIAs.

As a Fee Only Fiduciary Advisor we only receive compensation from our clients. We receive compensation by charging an ongoing asset management fee based on the value of investments in your advisory account.  We can also receive compensation based on an hourly fee for financial planning services.