By: Jack WaymirecloseAuthor: Jack Waymire Name: Jack Waymire
Email: jack@InvestorWatchdog.com
Site: http://www.investorwatchdog.com
About: Jack entered the financial services industry as an institutional consultant and later as vice president at Warburg, Paribas, Becker in 1976. From 1983 to 2003 he was the President of Lexington Capital Management and related companies. In December, 2003 John Wiley published his book "Who's Watching Your Money? The 17 Paladin Principles for Selecting a Financial Advisor". In 2004, he founded PaladinRegistry.com, a website that educated investors about financial advisors. A national Registry of pre-screened, five star rated advisors was added to the website later in 2004. In 2009, he founded InvestorWatchdog.com, a website that provides tools and information to investors who use the services of financial planners and financial advisors. Since 2004, Jack has been frequently quoted in the media on topics about financial advisors, Wall Street firms, investment scams, and the financial services industry (BusinessWeek, Forbes, Kiplinger, Washington Post, etc.).See Authors Posts (66) | January 25, 2012 | Conflicts of Interest, How to Select Advisors

Financial planners, financial advisors, investment advisors, and money managers are financial fiduciaries. That’s because they are Registered Investment Advisors (RIAs) or Investment Advisor Representatives (IARs) who work for RIAs. What does this mean to you, the investor?

Fiduciaries are held to the highest ethical standards in the financial services industry. They are required to put their clients’ financial interests ahead of their own. In other words, your financial interests come first.

Non-fiduciaries are held to a lower ethical standard called suitability. In a nutshell, a suitable investment means that an investment is appropriate for an investor’s willingness and ability to take on some level of risk. Here’s a good article that explains suitability in more detail.

If you’re looking for a new financial advisor or your first financial advisor, make sure you select an RIA or IAR and require them to acknowledge their fiduciary responsibilities in writing. Remember: it’s your money so the financial professional you hire should have the highest level of accountability back to you, the client!