What is a Fiduciary? Why is Fiduciary Duty Important?
There has been a lot of talk in the past few years about “fiduciary duty.” Senior Financial Planner Allison Alley, CFP® of Pure Financial Advisors explains what it means to be held to the fiduciary standard, and why it’s important to work with a fiduciary when it comes to financial planning. One of the questions we get quite a bit is what is a fiduciary, what’s the fiduciary duty and why is that important? Well, a fiduciary is a person or a legal entity, like a bank or a brokerage firm, that’s legally required to act in the best interest of a client in situations requiring total trust honesty and good faith. Really, anyone can be a fiduciary. The most common example of a fiduciary is a trustee of a trust. But corporate officers are also fiduciaries to their shareholders. Attorneys are fiduciaries to clients, and some but not all financial advisors are fiduciaries to clients. It’s also important to understand what the fiduciary duty is. The fiduciary duty is the highest standard o...