ADVERTISEMENT

The web's best personal finance advice.

An Odd Word With A Big Advantage: Defining A "Fiduciary"

IN THE PRESS:

Jan. 1, 2021

Merriam-Webster defines fiduciary this way: “one that holds a fiduciary relation or acts in a fiduciary capacity.” Not all that helpful... 

For a word that’s been around since 1631, it sure has done a good job of escaping understanding. 

But by consulting another dictionary, one might finally understand what all the hype is about. Dictionary.com defines fiduciary this way: “a person to whom property or power is entrusted for the benefit of another.” That’s better.

 

Click Your State to Get Matched With Financial Advisors Near You

After you choose your state and answer questions about your financial goals, you can compare up to three advisors local to you and decide which to work with.

map
AL AK AZ AR CA CO CT DE FL GA HI ID IL IN IA KS KY LA ME MD MA MI MN MS MO MT NE NV NH NJ NM NY NC ND OH OK OR PA RI SC SD TN TX UT VT VA WA WV WI WY DC

Investing involves risk and no situation is the same. This is in no way intended as a personal recommendation and investment decisions are solely those of the reader.

Some financial advisors are fiduciaries, obligated by law to act in your interest as they manage your assets or money. Rather than operating out of self-interest (such as recommending insurance policies or investments in pursuit of fees and commissions), a fiduciary advisor is obligated to make recommendations that benefit you, the customer. 

The benefits of a fiduciary are clear: Americans who enlist fiduciary advisors report increased investment gains and benefit from increased assurance regarding financial decisions. A 2019 Northwestern Mutual study found that U.S. adults who work with a financial advisor report “substantially greater financial security, confidence, and clarity than those who go it alone.”

Yet knowing how to find a reputable fiduciary advisor is, for many, the most confusing task of all. Common Google searches related to the topic reveal a desperate search for direction. “Fiduciary financial advisors near me,” “best fiduciary financial advisor,” and “financial investment advisors near me” are searched for hundreds of times per day.

Finding a fiduciary shouldn’t be that hard. Thankfully, it isn’t.

SmartAsset’s free match quiz helps Americans find and vet qualified financial advisors near them. The quiz asks about your financial goals, then matches you with three local financial advisors. You can then pick the advisor that best fits your financial needs. best fit to serve your needs. The matches are yours at no cost, and you may contact your matches for free consultations.

Get matched with 3 licensed fiduciary financial advisors near you today. Check out Smart Asset’s no-cost tool now.

SmartAsset AWARDS & ACCOLADES

Helpful Resources 

Today's Top Mortgage Rates

> These historically low rates can save you thousands on a home purchase or refinance.  See Rates

Top Online Brokerage Accounts

> This online brokerage comparison tool helps find the best trading platform for you.  Try Now

Today's Top High-Interest Savings Accounts

> These savings accounts have interest rates up to 500x the national average. See Accounts

SmartAsset is a personal finance technology company that features a financial advisor matching service. Financial Advisors who appear on SmartAsset are from companies with which SmartAsset receives compensation. SmartAsset takes into consideration wealth and location to determine how to match users with advisors. SmartAsset doesn't include the entire universe of Financial Advisors.

Sources:
1. Northwestern Mutual study
2. Value of a Gamma-Efficient Portfolio (2017), Morningstar Investment Management.
3. The Return on Advice (2016), Envestnet, Capital Sigma.
4. Value of a Financial Advisor Study (2017), Russell Investments.
5. Advisor Value (2014), Voya Retirement Research Institute.

Get Smart with Your Assets

Terms of Use  |  Privacy Policy  |  About Us

© 2020 SmartAsset