What is a fiduciary financial advisor?

The suitability standard asks whether a recommendation is appropriate given your situation. The fiduciary standard asks whether it is the best available option for you. The distance between those two questions is where most of the cost lives.

Two annuities can both be suitable for the same retiree. One pays the advisor 7% and one pays 1%. Suitability permits either. A fiduciary duty does not.

Registered Investment Advisors register with the SEC or a state and are held to the fiduciary standard. Their representatives typically hold a Series 65. Broker-dealer representatives hold a Series 7 and are held to Regulation Best Interest, which is stronger than old suitability rules but still not a fiduciary duty.

Check FINRA BrokerCheck and the SEC's Investment Adviser Public Disclosure database. Both are free. Then read Form ADV Part 2 — it discloses how the advisor is compensated and what conflicts exist.

Ask: are you a fiduciary at all times, in writing? The qualifier matters. Some advisors act as fiduciaries when providing planning advice and as brokers when selling products, switching hats within the same relationship without announcing it.

An advisor who is a fiduciary always will say so plainly and put it in writing.

Ankerstar Wealth is a fee-only Registered Investment Advisor registered with the SEC. We are compensated only by our clients, we take no commissions or referral fees, and we never take custody of client assets — Schwab does. Our advisors hold Series 65 licenses and several hold the CFP® designation.

All of it is verifiable through FINRA BrokerCheck.