Brokers Refuse To Put Clients Interest First By Becoming Fiduciaries

Most investors are unaware that two worlds exist in Financial Advising.  One world (of the Stockbroker & Brokerage Firm) sells product and they must make recommendations that are ’suitable’ to the investor.  The stockbroker (or advisor as many prefer to call themselves today) works first for the firm and then the consumer.  An ‘Independent Registered Investment Advisor’ on the the other hand, must put a consumer first and disclose all conflicts of interest in a clear and upfront manner.  All registered investment advisors also work off a fee based compensation model instead of a commission based.  For this reason, conflicts when selling or advising on securities should be more transparent and client focused.  Read all of the articles below if you are using a broker that works for a firm (key hint: they’ll have all kinds of wording at the bottom of their card saying “investment offered through xyz firm…….etc…etc..).  This is a broker and even though they may also be an ‘investment advisor’, you are dependent on them on some deals working for the firm and in some cases working for you.  Our suggestion is stay away and ONLY deal with Independent Registered Investment Advisors.

Group wants client interest put first: Edward Jones get 1/2 of revenue from ‘Preferred Funds.’ St. Louis Post Dispatch