Opinion: Tony Robbins: 7 questions you must ask to keep a financial adviser honest
This is the first of a series of articles from life- and business strategist Tony Robbins on sharpening your investing and personal-finance skills.
Doctors, lawyers, and certified public accountants in the United States are legally required to act in the best interests of the people they serve. Yet financial advisers get a free pass. There are more than 200 different designations for financial advisers, including “financial consultants,” “wealth managers,” “financial advisers,” “investment consultants,” “wealth advisers,” and — in case that doesn’t sound exclusive enough — “private wealth advisers.”
But the reality is, of the roughly 310,000 financial advisers in the U.S., less than 10% are legally obligated to put your interests first at all times on all of your accounts. These are called “registered investment advisers” or RIAs for short. RIAs don’t accept sales commissions. Instead, they typically charge a flat fee or a percentage of your total assets for unbiased financial advice. It’s a cleaner model that removes awkward conflicts of interest and hidden agendas.