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The Fiduciary Standard and Its Importance to Investors

by AOG Wealth Management

The fiduciary standard is emerging from the relatively unknown and becoming a mainstay of the investor-financial advisor relationship. President Obama recently gave a speech about the fiduciary standard, stressing that it should be used by more financial advisors. AOG Wealth Management, professional Potomac and Northern Virginia wealth advisors, discusses what the fiduciary standard is and why it is important to investors.

What is the fiduciary standard?

The fiduciary standard refers to the rules regarding the responsibilities financial service professionals have to their customers. Basically, it obligates advisors to put their clients’ best interests before their own. For example, let’s say two similar financial products have different costs. Under the fiduciary standard, an advisor must recommend the product that is most suitable for the client, even if it means the advisor makes a smaller commission.

Why is the fiduciary standard important to investors?

The goal of the fiduciary standard is to eliminate the conflict of interest that can exist when financial advisors recommend and sell investments to their clients. Placing a client’s interests ahead of your own is an important aspect in financial advising. Simply put, the fiduciary standard is there to protect investors. Investors therefore need to understand if someone selling them an investment is abiding by the fiduciary standard. Some do and some don’t. So be sure to ask.

How do I look for a financial advisor that I can trust?

Look for a financial advisor who is certified by the Certified Financial Planner Board of Standards (CFP Board). These certified financial planners (CFPs) advise on various financial issues, including insurance, taxes, and estate planning. They are also required to fulfill continuing education requirements.

AOG Wealth Management is an independent Registered Investment Advisor specializing in managing wealth for individuals, companies and endowment funds. As a boutique investment advisory firm, AOG serves clients by offering investment vehicles typically not utilized by larger wealth management firms by using a four-pillar approach combining investment strategies, tax efficiency expertise, legal / estate planning and risk management. Going beyond the traditional asset classes of stocks, bonds and cash, and employing an endowment-style model, AOG adds up to five non-traditional asset classes with low stock market correlation. Our model forces a “buy lower” and “sell higher” discipline providing asset management services to clients in Northern Virginia and Washington, DC – including Arlington, Reston, Great Falls, McLean, Vienna, Leesburg, and Georgetown. For quality asset management, call us at (866) 993-0203 or visit us on the Web at today.

AOG Wealth Management, Inc. does not provide tax or legal advice. The opinions and views expressed here are for informational purposes only. Please consult with your tax and/or legal advisor for such guidance.

The article and opinions in this publication are for general information only and are not intended to provide specific advice or recommendations for any individual. We suggest that you consult your accountant, tax, or legal advisor with regard to your individual situation.

Category: Wealth Management