Is your financial adviser really acting in your best interests?

Do you know if your financial adviser is acting in your best interest or if they are even required to?

Carl Carlson, CEO of Carlson Financial answered these questions and explained to News 3 viewers what “fiduciary” means.

Last year there was a law passed that required all Financial Advisers to act in their client’s best interest but it was just recently done away with through the appeals court.

Carlson said financial advisers don't always act in their clients' best interest. If someone in the financial industry is not a fiduciary, then they may be working in their own best interest or in the best interest of the company they work for.

If a financial representative is not a Fiduciary and they could sell you a product or investment that they make $3,000 on or they could sell you another sort of similar product that they make $1,000 on.

This person would probably sell you the one that got them more money but what if the one they make $1,000 on is better for you?  This is where the problem lies.

Clients can figure out if someone is a Fiduciary by asking the financial representative if they are a Fiduciary and if they only work under the Fiduciary standard.

Second, Carlson said to make sure the financial adviser shows you how much they are compensated on any products or investments they are showing you and that they make you aware of any conflicts of interest they might have and if so how they deal with those.  If you feel like you aren’t getting clarity, that’s a red flag!

Carlson said in short you should make sure they are a Fiduciary and you just want them to be upfront and transparent with you.