Financial Advisor Shopping? Ask Three Important Questions

CHICAGO, April 19 /PRNewswire/ -- The ugly truth: not every financial advisor is a fiduciary. A fiduciary is a person who legally and ethically places their clients' interests above their own. Some financial advisors are not held to this standard; their recommendations only need to be "appropriate" for a client's situation.

The simple fact: it is possible to find a financial advisor that is a fiduciary. To find an advisor that places their clients' interests first, ask the following questions:

1. How are you compensated? Find out about incentives for advice, such as commission or referral fees. Financial advisors that claim to be fee-based could accept other incentives that may sway their recommendations.  
2. Will you disclose possible conflicts of interest? To better evaluate given advice, a client should know about factors that could affect their advisor's recommendations. Any relationship, compensation or other incentive that may interfere with an advisor's ability to act in their client's best interest should be disclosed.
3. Are you legally obligated to act in my best interest at all times? If so, get this in writing. A financial advisor held to a fiduciary standard should be willing to do so.  

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SOURCE FinancialAdvisor.net