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The Fiduciary Difference

Updated: Apr 23

Too many people make the mistake of believing that all financial advisors – regardless of how they are paid -- are the same. Many don’t understand the difference between fee-based, commission-based, and fee-only.

Hi, I’m Bradford Ferguson of Halter Ferguson Financial and I get it. Regardless of how they’re paid,they all call themselves “financial advisors” and give themselves impressive titles, and might have a slew of letters after their name. It’s easy to believe that one is just as good as another.

But, if that were true, no one would ever leave their advisor. No one would ever be sold a product or solution that doesn’t really work for them. And no one would ever have second thoughts. And I can tell you, it happens all the time.

Just as these shapes are all blue doesn’t mean they aren’t very different. And if you keep believing that every financial advisor is the same, just because they share the same name, you’re likely to end up paying your advisor a huge commission. Then, while you’re stuck with buyer’s remorse about the financially limiting product you were talked into, that advisor stops returning your calls.

But you can actually find a financial advisor that will put your best interests first. Look for two important terms.

The first is fee-only. This means that your financial advisor isn’t paid by commissions. The ONLY way they earn their fee is based on your returns. A fee-only advisor earns money by doing a good job for you. And the better they do for you, the more they make. It’s a self-fulfilling cycle that benefits you!

The second is Fiduciary. This means that your financial advisor is legally required to act in your best interest. Fee-only aligns their financial interest with the growth of your money.

So, let me ask, do you really want to take a risk with a financial advisor who might be more interested in making a quick buck, or do you want one who wins when you do and will always act in your best interest?

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