Fiduciary discussed on Jill on the Money


I think you do it's time to talk about fiduciary that we didn't do it last weekend because we just didn't have enough time to get all the information out for you but the very exciting news from the certified financial planner board of standards huge change what is that huge change starting october first of twenty nineteen cfp professionals anyone who's got that little cfp after their name that's like me i have that we now all must act in the best interest of our clients at all times now here's the difference it used to be the rule was that you would be subject to the fiduciary standard if you were conducting financial planning for a client but now any kind of financial investment any kind of like anything with a dollar sign kind of advice if you're cfp as of october first twenty thousand nine so a year plus away you now have to act in the best interest of your client you are subject to the fiduciary standard now remember this is a this is important because the vast majority of brokers or insurance reps that all the people who are selling some kind of securities product even if it's an insurance policy that has a securities component most of those people are held to a lower standard it's called suitability that means that would ever this salesperson recommends to you and i put recommending quotes i'm doing air quotes that has to clear pretty low bar it's it's essentially what is deemed suitable for you and it doesn't necessarily have to be in your best interest so effectively what that means for you is that you could pay more money for say five twenty nine plan that has you know some fees or commissions but it's not the best plan for you and i think that this is really important it also may mean that you're buying a mutual fund that has a big charge when a cheaper one exists maybe it means that you're buying some weirdo complicated insurance product which has all these bells and whistles that you don't really need when honestly the best thing for.

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