STEVE ROBBINS, CFP® is an independent fiduciary, fee-only investment adviser, who accepts no payment or economic benefit for professional services from any source other than client fees.
For years, many advisers have followed the Suitability Standard. This means they are only expected to make recommendations that are considered "suitable" for their clients. This allows advisers to give advice that may be in the adviser’s best interest, but not necessarily in the client's best interest, as long as that advice can technically still be considered "suitable."
There is, however, a higher standard that some advisers hold to. It's called the Fiduciary Standard. Advisers who are fiduciaries put their clients' interests before their own. Even if the advice that an adviser gives is less good for the adviser, they must give it if that's what is best for the client.
On December 15, 2020, the Department of Labor issued its interpretation of fiduciary. Basically, when we provide investment advice to you regarding your retirement plan or individual retirement account (IRA), we are fiduciaries under the laws governing retirement accounts. As a fiduciary we must (1) meet a professional standard of care when making investment recommendations (give prudent advice); (2) never put our financial interests ahead of yours when making recommendations (give loyal advice); (3)avoid misleading statements about conflicts of interest, fees, and investments; (4) follow policies and procedures designed to ensure that we give advice that is in your best interest; (5) charge no more than is reasonable for our services; and (6) give you basic information about conflicts of interest.
In the End
So, what does all of this mean for our firm? Absolutely nothing.
You see, we have been following the Fiduciary Standard for years. We've always put our clients' interests first. There are three reasons for this. First, because we know the only way we can be successful is if our clients are successful. Second, because our greatest passion is helping people work toward their financial goals, and we believe that acting as a fiduciary is the best way to do that. Third, and most importantly, we've always followed the Fiduciary Standard because we believe it's the right thing to do. So, for us, it's business as usual.