Do You Have A Trusted Advisor or Just A Salesperson?

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Smiling millennial couple listening to asian realtor, lawyer, bank worker, insurance broker or financial advisor consulting customers planning mortgage loan investment or real estate rent purchase

When I first moved to Calgary in 1994, I was 25, I was single, and I needed a vacuum cleaner. I sat down with a slick salesperson who sold me a high-end vacuum. Sure, I needed one, but did I need to spend $2,000 on a vacuum?! The salesperson gave me many reasons why I should buy one. He asked few questions. If he had been a trusted advisor, the experience would probably have been different.

What is a Trusted Advisor?

The highest form of a Trusted Advisor is a Fiduciary.

What is a Fiduciary?

“A fiduciary is someone who has undertaken to act for and on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence.” (Wikipedia)

We all want to believe the people who are guiding us are working in our best interests. In the financial services industry, we hope the people we trust to advice and mentor us are working to the highest standard possible when it comes to our money.

One way to evaluate if you have a trusted advisor is to determine if they are part of the Financial Planners Association of Canada (FPAC). FPAC requires all members to subscribe to a charter that upholds a fiduciary standard. Not all Certified Financial Planners are members of FPAC. You can learn more about FPAC here: https://fpassociation.ca/page/the-fiduciary-pledge.

The salesperson who sold me my first vacuum was definitely not a fiduciary or even a trusted advisor. I would have appreciated a trusted advisor instead of a salesperson, but the negative impact was low. In contrast, financial advice or a financial product sold to you without using a trusted advisor may be inappropriate or, even worse, hurt you long term.