Financial Planning

What Does It Mean to Work With a Fiduciary?

“Fiduciary” can sound like financial-industry jargon, but the idea behind it is important.

As a Registered Investment Adviser, Innova Wealth Partners has a fiduciary duty to its advisory clients. That duty includes both a duty of care and a duty of loyalty and applies within the scope of the advisory relationship.

In plain English, what does that mean?

When we provide investment advice, we are required to act in our clients’ best interests and not put our own interests ahead of theirs.

The duty of care includes developing a reasonable understanding of a client’s objectives and providing investment advice that is in the client’s best interest based on those objectives.

The duty of loyalty requires an investment adviser not to subordinate a client’s interests to its own. It also requires conflicts of interest to be appropriately addressed, including through elimination or full and fair disclosure as applicable.

Why does fiduciary responsibility matter to a client?

Financial advice can affect some of the most consequential decisions you make about your money. Understanding the standard your advisor is required to follow can help you better understand the relationship you’re entering.

At Innova, we believe that responsibility also fits naturally with the way we want clients to experience financial planning: through education, transparency and partnership.

We want you to understand not only what we’re recommending, but why we’re recommending it and how it relates to the financial goals we’ve discussed together.

Is “fee-only” the same as “fiduciary”?

No. The terms describe different things.

Fee-only describes how we are compensated. Innova Wealth Partners is compensated directly by clients for investment advisory and financial planning services and does not receive commissions from the sale of financial products.

Fiduciary describes our responsibility to our advisory clients. When providing investment advice, our fiduciary duty requires us to act in the client’s best interest within the scope of the advisory relationship.

Together, understanding these two concepts can give you a clearer picture of both how your advisor is paid and the responsibilities that govern the advice you receive.