The industry of financial advice is filled with both good and bad actors, and it can be difficult to determine which advisors can be trusted, especially if you have limited knowledge of financial jargon and industry practices. It's important how different advisors structure their practice, how they get paid, and what incentives they have for selling investment products. A key term is fiduciary, an advisor who is professionally and legally bound to act in the clients best interest. Other financial advisors are held to a lower standard, and often have incentives to sell you certain investment products that generate more fees for them, regardless of whether they are the best fit for you.

In this episode, Matt explains how fiduciaries structure their fees, and how their incentives align with the client. He explains how other financial advisors held only to a "suitability" standard can steer you toward unnecessarily expensive or risky investments. He also outligns several questions you should ask an advisor before engagng their services, including:

Are you a fiduciary 100% of the time? Do you ever act in a non-fiduciary capacity?
How do you get paid? Commissions vs. fee-based, or both?
Do you receive any incentives for the products you recommend?

Asking the right questions is critical to make sure your advisor is aligned with your goals and interests, and not just theirs (or their employers).

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Advisory services offered through Commonwealth Financial Network®, a Registered Investment Adviser.

This material is intended for informational/educational purposes only and should not be construed as investment advice, a solicitation, or a recommendation to buy or sell any security or investment product. Please contact your financial professional for more information specific to your situation. Investments are subject to risk, including the loss of principal. Some investments are not suitable for all investors, and there is no guarantee that any investing goal will be met. Past performance is no guarantee of future results. Exchange-traded funds (ETFs) are subject to market volatility, including the risks of their underlying investments. They are not individually redeemable from the fund and are bought and sold at the current market price, which may be above or below their net asset value.