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Oct 21, 2016

What the Fiduciary? A Guide to Your New Favorite F-Word.

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Who’s looking out for your best interests?

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Need a new favorite ‘F-Word’?

The word fiduciary is a powerful concept that defines a very specific relationship.

A fiduciary is ethically and legally bound to act in the best interest of the person whose assets they are managing, even at their own cost.

When you hear fiduciary, think trust and duty.

Trust is vital to the fiduciary relationship. Fiduciaries are required to act in your (their client’s) best interests. This isn’t just an ethical relationship, but also a legal obligation. This bond is one of the highest legal standards of care, or duties, that one party can owe to another.

What does a fiduciary do?

Fiduciaries have a lot of things on their plates. They must take all available info into account and then act judiciously. They also have to fulfill this laundry list**:

  • ensure full disclosure of material facts
  • avoid conflicts of interest
  • preserve confidentiality
  • provide suitable advice
  • and put clients interests ahead of their own.

Who’s a fiduciary? 

  • Money Managers
  • Investment Consultants
  • Financial Planners
  • And… Investment Advisors, like Stash!

For you legalese lovers: in the case of Investment Advisors, the fiduciary relationship is grounded in Securities Laws* and overseen by the SEC and/or state securities regulators.

Now you know!

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