Why Fiduciary Matters

When selecting a financial adviser, few distinctions are more important than whether that adviser is a fiduciary.

A fiduciary is legally and ethically required to act solely in the client’s best interest. This obligation applies not only when advice is first given, but on an ongoing basis as circumstances, markets, and tax laws evolve.

An important distinction

Many large financial service providers—particularly those operating brokerage, bank, or insurance-based models—do not act as fiduciaries at all times. In those environments, advice may be governed by a suitability or best interest standard that allows recommendations influenced by product availability, proprietary offerings, or compensation structures.

While such arrangements are legal and often disclosed, they introduce incentives that are not always fully aligned with client outcomes.

What fiduciary advice means in practice

As a fiduciary adviser, my responsibility is to provide advice that is:

• Objective and evidence-based

• Free from sales incentives and product bias

• Aligned with the client’s entire financial picture, not individual transactions

My practice is compensated exclusively by clients. I do not receive commissions, referral fees, or compensation from investment managers, insurance companies, or product sponsors. This structure is intentional and designed to minimise conflicts of interest.

Why this matters for high-net-worth clients

• Aligned incentives Advice is paid for directly by the client, not indirectly through product compensation.

• Cost and tax discipline At higher asset levels, small differences in fees, turnover, and tax efficiency can have significant long-term effects.

• Holistic decision-making Fiduciary advice evaluates trade-offs across investments, taxes, cash flow, estate structures, and long-term objectives.

• Long-term accountability Fiduciary responsibility is continuous, not transactional. Advice must remain in the client’s best interest over time.

Advice, not product distribution

A fiduciary adviser’s role is to provide judgment, clarity, and discipline—not to distribute financial products. This distinction becomes increasingly important as wealth and complexity grow.

Fiduciary Oversight and Regulatory Obligations

As a registered investment adviser, I am subject to a formal fiduciary standard under federal and/or state securities law. This includes ongoing obligations to:

• Act in the client’s best interest at all times

• Disclose all material facts, including fees and potential conflicts

• Provide advice that is prudent, suitable, and well-documented

• Maintain compliance policies, record-keeping, and supervisory procedures

These requirements are enforced through regulatory oversight, periodic examinations, and mandatory disclosures. The fiduciary standard is not a marketing label—it is a legally binding duty.

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Dr. Andy Lawson is the principal of Freshfield Investments, a Registered Investment Advisory firm in Plano, Texas serving clients locally and nationwide. Freshfield provides investment management and financial planning as a fee-only, fiduciary. To book a virtual or in-person complimentary consultation, please visit our Contact page.

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Data source: Kenneth R. French Data Library, Tuck School of Business, Dartmouth College

My thanks to David Welch, Citibank and Alexandra Neff, Bank of Texas