Have you ever heard the word “fiduciary”? There’s a big fight over this word in Washington right now regarding the Department of Labor Fiduciary Rule.
As you can see in the infographic from the National Association of Personal Financial Advisors (NAPFA), a fiduciary is a professional who is required by the law put their clients’ best interests first and disclose conflicts of interest. At all times. Period.
So, what’s the problem here?
There are many financial professionals who are not required to act as fiduciaries. This means that they do not have to do what is in your best interest and they can recommend investments and products to you which may make them more money than a similar product that may make them less money but may actually be better for your situation.
A lot of the major financial services organizations that currently don’t have to act as fiduciaries have banded together and filed suit against the DOL because they don’t want to have to act in your best interest when they sell you something.
