Fiduciary Battlecry

Investment advisors are screaming from the roof tops, “We are a fiduciary!” and “Don’t work with anyone who is not a fiduciary!”

What does “fiduciary” mean?  According to Merriam-Webster:

1.Held or founded in trust or confidence

2.Holding in trust

3.One that holds a fiduciary relation or acts in a fiduciary capacity

In English it means the advisor puts your interests first above their own or in even simpler terms, do what’s right for the customer whether it makes the advisor the most money or not.

Registered Investment Advisors are required by law to act as fiduciaries. The general population is required by law to not kill each other. I would like to believe the overwhelming majority of the population does not need a law to keep us all from killing each other.

In large part, I also believe the same principal applies to acting as a fiduciary.  It is very difficult to legislate morality and ethics.  If an advisor if going to take advantage of someone, they will do so whether held to a fiduciary standard or not.  If the only thing keeping them honest is the fear of getting caught, then they will probably bend if not break that fiduciary trust along the way.

So maybe the, “We are a fiduciary!” battle cry should really be, “We usually act as a fiduciary unless we think we can get away with it!”