How to Select an Advisor Who Will Act in Your Best Interest.

Working with an investment advisor.

Investment advisors must always provide you with advice that is in your best interest and most suitable for your circumstances. Learn more in this article written by Tara Siegel Bernhard and published by the New York Times on Oct. 10, 2014: Before the Advice, Check Out the Advisor. Investment Advisor

Brokers, who often describe themselves as “advisors,” must recommend investments that are suitable for you given your various circumstances and preferences for risk. Now, suppose two different funds are appropriate for your portfolio. One is managed by Vanguard and the other is more expensive in part because it pays a fee to the selling broker or his firm. Both funds are presentable, but one is more advantageous to you because it has lower fees.

As a fiduciary, an investment advisor would select the fund with the lower fees. A broker, also known as a registered representative, could legally sell you the higher cost fund.

Understand who you are dealing with and their compensation.

When it comes to investing your hard-earned savings or family fortune, slow down and take the time to really understand who you are dealing with and how they are compensated.

Tips to select a trustworthy advisor.

Locate an investment advisor who: 

  • works with clients strictly on a fee basis.
  • does not sell products such as life insurance or annuities.
  • does not earn fees from mutual fund companies, custodians or other investment firms.

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