Four adviser groups today announced an initiative to help small investors in the Washington DC area find an investment adviser who gives real advice as a fiduciary at all times.
A new website, www.noincidentalinvestors.org, offers investors in the Washington DC area assistance identifying investment advisers who work under a fiduciary standard at all times and serve any investors that have specific needs or more modest means. These advisers do not sell products and have no investment asset minimums.
The project offers to provide small investors in the Washington DC area with referrals to at least two local advisors who stand ready to serve on a fee for service basis. The project also offers information to explain to consumers why brokers’ advice, according to the law, is incidental to selling products and not real advice.
The groups are the Institute for the Fiduciary Standard, the Garrett Planning Network, the National Association of Personal Financial Advisors (NAPFA) and the XY Planning Network.
The announcement comes a week after the SEC proposed rules that, among other things, aim to raise brokers’ suitability standard.
“The proposed SEC rule, “Regulation of Best Interest”, seeks to raise the suitability standard and is a good first step. Yet, much more needs to be done. The simple fact remains that investment advisers represent their clients and broker-dealers represent issuers, said Knut A Rostad, president of the Institute for the Fiduciary Standard which coordinates the project.
Rostad continues, “Two facts regarding small investors and advice stand out. Investment advisers have served small investors for decades, and broker-dealers offer recommendations as an incident to a product sale. Like car dealers offer “advice”, as they press customers to buy a car.”
“NAPFA members have a long-standing tradition of providing advice under a fiduciary standard to all clients, large or small, at all times,” said Geoffrey Brown, CEO of NAPFA. “Many NAPFA members work with investors who have limited assets or income due to age, occupation or health issues. In the end. NAPFA members take great pride in helping small investors become large investors. It’s what they do.”
“If you want advice from someone who has chosen to put your interests ahead of their own, look no further than to members of one of these participating organizations, said Sheryl Garrett, CEO of the Garrett Planning Network. The Garrett Planning Network has proudly served people of all ages and stages of life since 2000. We know that real advice is not “incidental.” It’s the opposite; it’s why we exist.”
“The founding mission of the XY Planning Network, is to bring real financial planning advice to Gen X and Gen Y consumers because we believe consumers should have a choice between a salesperson who provides only incidental advice and a financial planner who provides real financial advice, Michael Kitces, co-founder of the XY Planning Network, notes.
Institute for the Fiduciary Standard
The Institute for the Fiduciary Standard formed in 2011 as a non-profit to provide research and education on the vital role of the fiduciary duties for investors and the capital markets. The Institute’s Best Practice advisors affirm their fiduciary and fee-only practices to the SEC.
NAPFA
Since 1983, the National Association of Personal Financial Advisors (NAPFA) has provided fee-only financial planners across the country with some of the highest standards for professional competency, comprehensive financial planning, and fee-only compensation. Today, with more than 3,200 members, NAPFA is the leading professional association dedicated to fee-only financial planning. Learn more at https://www.napfa.org/.
XY Planning Network
XY Planning Network is the leading organization of fee-only financial advisors who specialize in helping members of Gen X and Gen Y. Our advisors stand out from the rest of the financial planning industry because of the way they put their clients first. Learn more at https://www.xyplanningnetwork.com
Garrett Planning Network
The Garrett Planning Network has a nationwide membership with hundreds of independent, fee-only financial planners providing advice to people from all walks of life, without minimum account requirements, sales commissions, or long-term commitments. Learn more at http://www.garrettplanningnetwork.com.
