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Charisse Mackenzie explores differences between fiduciary and suitability standards

Charisse Mackenzie

When looking for an financial advisor, it's essential to fully understand the differences between the fiduciary and suitability standards.

GILBERT, ARIZONA, UNITED STATES, November 6, 2018 /EINPresswire.com/ -- Understanding the difference between a fiduciary and a suitability standard is crucial if an individual is looking to invest. Within the financial services industry, someone who is held to a fiduciary standard, commonly referred to as a “fiduciary”, is inevitably an advisor who is employed by a registered investment advisory firm (RIA) and has a legal obligation to make recommendations based on the clients best interest. An individual held to the suitability standard, commonly known as a broker, is often more akin to a salesperson and only held to the duty of providing a recommendation based on the product being suitable at the time of sale. .

The main difference, according to Charisse Mackenzie, herself an Accredited Investment Fiduciary (AIF) is that a broker's primary objective is to make money for their employer, not necessarily for the individual investors. "An advisor, however," says Mackenzie, "has an outlined legal obligation to work in the best interests of their clients."


Fiduciaries are employed to act in only the very best interests of their clients. Unlike a broker, an advisor must put to one side any personal motives. "They are also obliged by law to disclose any conflicts of interest," points out Mackenzie. This is to further ensure that the advisor is pursuing the best interests of their clients at all times.

"It could be argued that most investments are 'suitable' to some extent," Mackenzie suggests, "which could be a long way away from what's actually best for an individual client."


"Don't be afraid to ask an advisor, 'Are you held to the fiduciary or suitability standard?'" explains Mackenzie. "There's no gray area, and an investment advisor representative is a full-time fiduciary, it's as simple as that," she adds, wrapping up.

Content prepared by Eric Ash

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