Fiduciary vs. “best interest”
| Fiduciary (investment adviser) | Regulation Best Interest (broker) | |
|---|---|---|
| When it applies | Throughout the advisory relationship | At the time of a recommendation |
| Ongoing monitoring | Generally yes, as agreed | Not required |
| Typical pay | Advisory fees | Commissions |
Both standards require putting your interest first. The difference is scope and duration.
What the fiduciary duty requires
Registered investment advisers owe clients a fiduciary duty under the Investment Advisers Act of 1940. It has two parts:
- Duty of care. Advice must fit your goals and situation, rest on a reasonable understanding of both, and be monitored over time.
- Duty of loyalty. The advisor can’t put their interests ahead of yours, and must fully disclose any conflicts of interest.
CFP® professionals also commit to a fiduciary standard whenever they give financial advice, under the CFP Board’s Code of Ethics and Standards of Conduct.
Why the word alone isn’t enough
“Fiduciary” shows up in a lot of advertising. Many advisors are dually registered and can act as a fiduciary on one account and as a broker on another, so the label can change from account to account. Ask which standard applies to each of yours, and get the answer in writing.
How to check any advisor
- Search their name on the SEC’s Investment Adviser Public Disclosure site and FINRA’s BrokerCheck.
- Read their Form CRS: a short summary of services, fees and conflicts.
- Read Form ADV Part 2, which describes how the firm is paid in more detail.
- Ask directly: “Are you a fiduciary on all of my accounts, all of the time?”
How Rubiq works
A fiduciary in our advisory relationship.
Rubiq’s investment advice is provided through Wealthcare Capital Partners, an SEC-registered investment adviser. In that advisory relationship, we act as a fiduciary. Andreas Wochtl is a CFP® professional. We serve business owners, executives and professionals across Chester County and the Philadelphia area.
Schedule a callFrequently asked questions
What is a fiduciary financial advisor?
A fiduciary financial advisor is legally required to act in your best interest, putting your needs ahead of their own, throughout the advisory relationship. Registered investment advisers owe this duty under the Investment Advisers Act of 1940.
Are all financial advisors fiduciaries?
No. Brokers recommending securities follow Regulation Best Interest, which applies at the time of a recommendation rather than across an ongoing relationship. Many advisors are dually registered, so ask which standard applies to each of your accounts.
Are CFP® professionals fiduciaries?
CFP® professionals commit to a fiduciary standard whenever they provide financial advice, under the CFP Board’s Code of Ethics and Standards of Conduct.
Is Rubiq a fiduciary?
Yes. When we provide investment advice through our advisory relationship, we are legally required to act in your best interest.