Managing a large sum of money and assets is a challenge for many people. Even minor misuse can result in unnecessary expenses and losing savings that could have gone toward additional investments, retirement or other endeavors.
Having a fiduciary financial advisor on your side can help you achieve financial security and enhance your current financial situation. Learn how you can find one in your region.
Benefits of a Fiduciary Financial Advisor
A fiduciary financial advisor is bound by legal obligations to make recommendations and decisions in your best interest. As such, you can expect them to manage your money and investments with the utmost care.
Hiring a fiduciary financial advisor can be ideal for individuals who manage businesses or have high-earning careers, such as doctors or lawyers. A study finds that 34% of upper-income adults believe their financial situation will worsen in a year.
The advice you receive can serve as a preventive measure by helping you make informed decisions to ensure your economic stability. Your advisor would likely save you time from the trivial tasks of financial management, like paperwork and analysis.
Outside of entrepreneurship, established businesses, institutions and nonprofit organizations may also benefit from these fiduciary services. Their prowess could provide knowledge that translates into further financial sustainability or even new income streams.
Fiduciary Financial Advisors Vs. Financial Planners
While the terms may seem interchangeable, there are slight differences between a fiduciary and a general financial planner. A fiduciary is obligated to put your interests before their own. Financial planners have the same ethical responsibilities, but they have more flexibility since they do not have to face the same legal repercussions.
This lack of pressure can manifest in minor decisions that can lead to your dissatisfaction. For example, say you are choosing between two insurance plans. One has higher fees but offers greater returns, while the other has lower costs and a moderate return on investment.
A fiduciary advisor may recommend the former one if it is feasible for you. A financial planner may suggest the latter if they have an affiliation with the plan provider or are focused on spending the least amount of money.
Financial planners still aim to help you meet your financial needs and goals by coming up with a plan. However, it is key to note the distinction between legal obligations and how they may affect your experience.
How to Find a Top Fiduciary Financial Advisor
Finding a fiduciary financial advisor can be a lengthy process, but it is essential to avoid rushing the search so that you can find a credible and talented individual to work with. Here are some tips to keep in mind:
1. Understand Your ‘Why’
Beyond the general benefits of a fiduciary financial advisor, it can still be helpful to determine your personal financial needs and how they align with your overall financial journey. For instance, maybe you have kids and want to stabilize a business venture that can serve as a stream of income for their future. This goal would impact your financial moves and the type of advice that would benefit you most.
2. Consider Your Priorities
All fiduciaries are regulated to have your best interest in mind, but they can still vary in terms of their overall involvement and methodology. Do you want someone who is very hands-on when building your portfolio? Or would you prefer someone who only conducts financial check-ins now and then?
3. Check Credentials
There are numerous credentials that you can review to check the fiduciary’s financial knowledge and planning services. For instance, those under the National Association of Personal Financial Advisors and the Accredited Investment Fiduciary adhere to fiduciary duty. You can request their proof of membership or certification.
4. Look at Advisor Fees
A fiduciary can charge in a variety of ways. For instance, some have an hourly fee for a select number of services, while others have a flat rate that already includes all the services they provide. There are also people who charge clients annually based on a certain percentage of their assets.
5. Check Reviews and Seek Referrals
Looking up reviews from previous clients can give you an overview of what the experience is like when working with certain fiduciary financial advisors. Notice any benefits to look forward to and keep an eye out for criticism. If you have fellow family members, friends or business associates who have tried fiduciary services, consider asking for their recommendations.
6. Consider Proximity
With today’s virtual connections, you can get financial advice from experts far away. However, if you prefer to conduct face-to-face meetings or have assets in a certain area that need to be physically checked by your fiduciary, consider the proximity of the advisor you are eyeing.
Northeastern U.S. — Fort Pitt Capital Group in Pennsylvania
Fort Pitt Capital Group has been providing clients with exceptional financial services since 1995. It can find you the best fiduciary financial advisor in Pennsylvania, as it works with professionals who can help individuals, families and businesses.
Fort Pitt Capital Group has a manual matching process that takes in your unique financial situation, concerns and goals to get you the right advisor. Take advantage of the free consultation to find the right support and trustworthy expertise.
Creating and Comparing Your Shortlist
Building your shortlist can take some time, as it will require reviewing regulatory databases to confirm credentials and legitimacy. You will also have to compare your options based on their qualifications, service offerings, fees and overall approach.
It is best to get your shortlist down to just a few candidates to simplify the comparison stage. One way to do this is by analyzing whether they align with your current financial management approach.
What to Ask When Interviewing Advisors
An interview can help you get to know your potential fiduciary financial advisor. Make sure to ask standard questions regarding their credentials and fees. Here are several follow-up questions that can encourage a deep dive into their process.
Do You Have Specializations?
Fiduciary financial advisors may have areas of expertise. For instance, some people have experience helping those with an average net worth of $500,000, while others may have only helped those with higher net worths. Some might focus on helping people nearing retirement, while others only work with those already in that stage of their lives.
Do You Have a Team to Support You?
Some fiduciaries have an assistant or even a team that could handle administrative tasks. On the one hand, this means your advisor will have more time and energy to focus on analyzing your finances. On the other hand, it means that those additional people may also have access to your information. Ensure that they have strong data privacy practices.
Do You Offer Any Particular Products or Services?
A fiduciary is obligated to look out for your best interests, but they may still be employed by a firm. Check if they are tied to any particular products or services, or if they can work with other providers. This helps you gauge whether they would act in favor of their firm or if they would truly tailor their decisions for you.
What Is Your Thought Process for Evaluating Investments?
Investment evaluation and philosophy can vary from person to person, even among fiduciaries. Some may focus on diversification, while others prefer sustainability. These kinds of values can affect their thought process and recommendations. It is best to ask about this right away so that you are connected with someone who aligns with your own approach.
Do You Prepare Continuity Plans?
If you manage a business or organization and intend to keep it up for the long term, a fiduciary can help you throughout the process. However, things may change if they leave or retire. You want an adviser who will provide you with a continuity plan or recommend another fiduciary to keep your company running smoothly.
How Do I Know I Can Trust You?
Relationships between a fiduciary and their client should be transparent and open. Ask your potential advisor this question to encourage them to highlight the best parts of their skill set, as well as to share what they are willing to do to earn your trust. The best answers are often unrehearsed and earnest.
Why Did You Become a Fiduciary?
If you want to get to know your fiduciary on a deeper level, ask them about their motivations behind providing their financial advisory services. You might discover that they have genuine motivations or moral codes that go beyond legal obligations, driving them to truly help people.
How Will We Communicate Moving Forward?
Communication is key between a fiduciary and their client, and it is essential to establish clear expectations for it. Will you be meeting weekly or monthly when conducting discussions? Do you want to have face-to-face conversations or virtual meetings? Are they open to having non-scheduled discussions when you need them?
Ensure You Get the Right Financial Advice
You can find a fiduciary financial advisor in Pennsylvania, Texas and many other states to receive top-tier guidance on how to manage your finances. Make sure you connect with someone you can trust and communicate with for the long term.
Disclaimer: The information provided in this article is for general informational purposes only and should not be considered financial or investment advice. The content does not substitute for professional consultation with a qualified fiduciary financial advisor. Always perform due diligence and consult a licensed advisor before making financial decisions.
