Every one has an agenda, except your RIA.

“Your moms a fiduciary!!” Sounds more like a classic junior high insult rather than someone who could greatly benefit your financial life.

As you can probably tell from the the title and the previous paragraph, the financial term of the week is “Fiduciary” otherwise known as a Registered Independent Adviser (RIA).

Take any industry, the health and fitness industry for example. There are a metric Sh*t-ton of people with varying titles, many of them sound the same. Personal trainer, fitness coach, strength and conditioning coach, etc. The financial industry is no different. Wealth manager, wealth advisory, financial adviser, financial manager, retirement planner. All of these terms sounds great, but honestly what do some of these mean? What are the standards they have to meet? What are they obligated to do for you?

The sad truth is in many cases individuals with these titles have no more responsibility to your financial health than a gas station clerk selling you a lottery ticket. In fact many individuals with these title work for and answer to larger firms. Often they are required to sell products from the firms they work for.

Enter the world of the Fiduciary.

A Fiduciary is a type of financial adviser who is legally obligated to act in the best interest of his or her client. Essentially if they screw you over they screw themselves over. It isn’t guaranteed that you will never lose money with a Fiduciary, they arent shamans, gurus or fortune tellers. However like a doctor or lawyer they have to have a reason for doing (or sometimes more importantly not doing something). And when they make a decision it has to be for the benefit of their client.

One thing to be weary of is of the roughly thirty five thousand Fiduciaries out there, many of them are dual hatted as a broker as well. In fact there are only about five thousand financial advisers in the US that are solely Fiduciaries.

One piece of advice that I would give is to plainly ask “Are you acting as a Fiduciary for me?” Don’t be afraid to ask questions, have them explain things in layman’s terms. It can often be a red flag if they get annoyed at questions or get annoyed by having to explain things to clients. Google them and read as much as you possibly can on them. In the end though remember that the person who carries the most responsibility for your financial future is yourself.