Find out the difference between a fiduciary and broker advisor.
Fiduciary Standard
Kelly Financial Services LLC is a fiduciary.
There are dozens of questions to ask when interviewing the person you will entrust to manage and safeguard your hard-earned dollars. One of the first questions you should be asking any professional is whether they are a Registered Investment Advisor held to the fiduciary standard of care, or a broker held only to suitability standards.
What is a fiduciary? And why is this important?
A fiduciary advisor is required to always place the interest of a client above his or her own, and is therefore legally held to a much higher standard of care regarding a client's wants, needs and goals. When acting in a fiduciary capacity, an advisor is also required to provide advice based off a thorough and complete analysis of a client's entire financial picture in order to be sure any advice given is as accurate as possible. A fiduciary advisor represents the client only and not the motives and profitability of a company, and is therefore also required to give full disclosure and transparency of any potential conflicts of interests that exist.
A broker held only to a suitability standard is NOT required to place the needs of a client above his own, but rather only has to reasonably believe that any recommendations made are suitable for the client in terms of financial needs and objectives. This brings up an obvious issue of loyalty in that the broker's duty is first to the broker-dealer they work for, rather than to the client. Also, the need to disclose conflicts of interest is not as strict for a broker. Common examples can include proprietary products created by the company that are more profitable when sold, ending up as recommendations for the client. Another example includes incentives and profit-sharing arrangements from mutual fund companies that are received under the promise that the broker-dealer will recommend that company's funds to the client.
Every day financial products are sold for a commission. Once that broker has made their commission, their compensation is no longer tied to whether your account goes up or down. A fiduciary advisor has a flat percentage fee of assets, so their compensation is tied directly to how well your account does. Essentially, a broker gets compensation only when selling more products, whereas a fiduciary advisor's compensation goes up only when your account does.
At Kelly Financial Services, LLC, let us show you how to avoid upfront commissions, hidden fees and murky costs, and align yourself with a fiduciary advisor held to a higher standard of care.
Independent
While there are many terrific investment and insurance companies out there that provide a lot of great products and services, we recognize that no one company can be the BEST in every area.
And sometimes trying to be everything to everyone results in conflicts of interest, real or perceived.
When certain financial services companies create and package their own investments, representatives who work for those companies are often limited to only being able to provide those products, or at the very least pressured into making a recommendation that is most profitable for that company, not necessarily what’s best for clients.
And just as often, these same companies will go out of their way to try to explain to clients that there is no conflict of interest when recommending these proprietary products as if they are the best products for the client, without first also considering products offered outside the company. In other instances, is it unreasonable to think of the perceived conflicts of interest despite assurances to the contrary when one side of a firm underwrites a certain stock and the other side advises investing in that stock?
At Kelly Financial Services LLC we don’t have these worries and neither do our clients.
As an independent firm, we have the freedom to offer truly unbiased advice that is centered instead around the profitability of our clients, without any conflicts of interest. Being in such a position allows us to be able to recommend, seek and ultimately use virtually any product or service that is best for our clients. We are also not constrained from engaging in relationships with third-party professionals who can also help our clients achieve their long-term goals.
We enjoy our independence and our clients appreciate it, too.
At Kelly Financial Services, our sole focus is YOU.