Treskovich: Find a financial fiduciary for the New Year – The Ledger

Matthew A. Treskovich| Special to The Ledger

The start of a new year is a great time to review your financial plan. Think about the progress you made toward your financial goals last year, and whether your goals have (or should be) changed. If you worked with a financial adviser last year, think about whether that advisers advice helped you move toward financial independence.

Despite repeated attempts by the Securities and Exchange Commission and the Department of Labor to strengthen regulatory standards, the profession of giving financial advice still lacks strong protections for consumers.

Most financial advisersare not required to put your interests first when they give you advice.

Few of us would choose a doctor who only prescribed drugs from a handful of manufacturers who paid that doctor. But that type of relationship is common in the world of professional financial planning.

A fiduciary adviser has a legal obligation to put your interests ahead of their own. If your adviser isnt a fiduciary, you can never really know whether theyre recommending something because its best for you, or it pays the highest commission.

Registered investment advisers are required to be fiduciaries. Most other kinds of financial advisers such as brokers, bankersand insurance salespeople are not required to be fiduciaries. In many cases, they sell products and collect commissions.

There are many examples of financial advisers pushing inappropriate products to earn commissions. These abuses led the Securities and Exchange Commission to create the new "Best Interest" rules in 2019. Unfortunately, the new rules have not provedeffective at curbing abuses. Regulators continue to uncover and sanction bad behavior by commissioned brokers.

When in doubt, ask your adviser in writing if they are a fiduciary. Everyone says they will act in your best interest. A true fiduciary will put it in their contract.

Choosing a financial adviser is one of the most important financial decisions you will make. You owe it to yourself to seek the advice of someone who will act exclusively in your interest.

Matthew Treskovich is the chief investment officer for CPS Investment Advisors. He can be reached at 863-688-1725 or email Matt@CPAlliance.com.

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Treskovich: Find a financial fiduciary for the New Year - The Ledger