Fiduciary vs Broker vs Fee-Only

Choosing an Advisor to manage your Wealth is one of the most important decisions that you can make. It is a decision that will affect many decades of your life, heirs, and beneficiaries.

Therefore, it is crucial to work with a firm you can trust - one which is dedicated to understanding and addressing your specific individual goals and needs.

Before you make a decision about which firm to use, take the time to understand the type of advisor you are hiring, how they are compensated, what makes them qualified, and where their obligations lie...is it to you, or is it to the firm that employs them?

These videos and resources will help you make the best decision for yourself and your loved ones.

Videos:

What is a financial advisor?

Captive vs Independent

What To Look For In an Advisor

IAR, RIA, Broker, etc.. - Deciphering The Jargon

Want to learn more:

• Click here to see the full training that these videos are from.
• How to Choose a Financial Advisor
• LegalZoom article with Leibel: Certified Financial Planner vs Financial Planner
• Leibel on FIRE: S2E9 - What Type of Advisor Should I Hire?
• Leibel on FIRE: S1E5 - How Advisors Are Paid

Common Terms & What They Mean:

Fiduciary: Someone who has a legal obligation of care and diligence when it comes to money. Since it is a legal definition, it really varies from profession to profession and situation. Unfortunately, fiduciary has become a marketing term, and everyone thinks they are fiduciary...regardless of the reality. More important than being a fiduciary is knowing the relationship you will have with your advisor, how they are compensated, and what are their incentives and obligations towards you and your money. Ask for it in writing, so all parties are clear.

Financial Advisor: This is not a regulated term. It can mean whatever the other party decides.

CFP or Certified Financial Planner: This is similar to the Chartered Financial Consultant or ChFC. It is an advisor who has taken education and met certain requirements. The best way to think about it is like having a bachelor's or associate's degree in financial planning. The real question you have to ask is what services will they be providing you?

Fee-Based: This is an advisor who gets paid both by fees that you pay as well as commissions that they earn from selling products, such as mutual funds or insurance policies.

Fee-Only: This is used to refer to advisors who only earn money by charging you fees directly. This can be either in the form of a percentage of assets under management, subscription, project-based, or hourly fees.

Yields4U is a fee-only firm. Advocates for fee-only say that it better aligns advisor and client interests.

As always, if you have questions, feel free to book a no-obligation appointment or email us at [email protected]