Spencer graduated from the University of Calgary with a Bachelor of Commerce degree and holds the Certified Financial Planner (CFP), Registered Financial Planner (R.F.P.) and Chartered Financial Analyst (CFA) designations. Spencer sat on the national board of the Institute for Advanced Financial Planners (IAFP) for 7 years and was part of the 2019, 2021 and 2022 National Finalist – Multi Service Advisory Team of the Year, an honor recognized through Wealth Professional.

Fiduciary Standard or a Pretender

You might see on our website (www.cardinalpointwealth.com) that our advisors adhere to something called a “fiduciary standard.”  But the term can be confusing for people who aren’t in the investment advisory business.

The fiduciary standard is a legal concept, but its core idea is not complicated.  To act as a fiduciary means we as professionals must put aside our own financial interests and also put aside the business/financial interests of any company we may be affiliated with and give recommendations that are solely and completely in the best interests of people like you, our prospective or existing clients.

In other words, our recommendations must be made with only one concern—is this the best thing that we, as your advisors, can do for you, given what we know about who you are and what you want and need?

So, what does it mean NOT to be a fiduciary?  Imagine that there were two kinds of health practitioners in the world.  One group functions much like physicians do today: they work out of independent medical offices, meet with you, diagnose your ailments, prescribe a medical solution that they believe is the very best course of treatment, and they are paid directly for their services.

The other group of health care providers operates somewhat differently.  They wear white coats, which makes them look just like physicians.  Their office looks like a doctor’s office, but it is the branch office of a large drug company which requires its white-coated employees to give you an examination, and then, no matter what’s actually wrong with you, they will prescribe those drugs which are most profitable to the company.  

These might not be the best treatments, but under a set of very complicated regulations, these less-than-ideal prescriptions are deemed to be legally defensible ways to address certain medical problems.  These other health care providers are paid by the company according to how many of these treatments they can sell to you.

Now imagine that these larger companies, because of the very high profits they’re making from these treatments, can gain a lot of influence over the process that decides which treatments are “suitable.”  In fact, their executives sit on the governing board of the organization that makes these determinations.

To bring this analogy back to the financial planning/investment advisory universe, our firm functions under a standard that puts your interests ahead of our own or any other outside organization.  Our firm is registered with the U.S. Securities & Exchange Commission as a registered investment advisor, which requires us to make this commitment to your best interests.  Given that we also operate similarly in Canada, we are also registered and governed by various provincial regulators as well. 

But there are many financial or investment advisors in the U.S. and Canada whose representatives are not registered with the Securities & Exchange Commission in the U.S. or provincial authorities in Canada, and who, if you ask them, would never put in writing that they will commit to serving you under a fiduciary standard.  They might assure you, verbally, that they follow a “best interest” standard, but that term is currently not well-defined and subject to a variety of interpretations in both the U.S. and Canada.

If you are currently working with an advisor who in essence, is posing as one of those physicians in white coats when they are “prescribing” financial advice or investment solutions that are in their (and their firm’s) best interest—then please find out if they are truly providing their advice and services as a fiduciary.   At Cardinal Point, our financial advisors operate under the fiduciary standard that fully recognizes that your wealth, family interests, and values are all interconnected.