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March 27, 2007


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I'll call out what I believe a vital part of the article:

"[O]ne important difference separates brokers from many of their competitors: Registered investment advisors and some financial planners are required to be fiduciaries — that is, to act in their clients' best financial interest. But brokers have no such duty. Because of that distinction, some consumer advocates argue that brokers shouldn't be allowed to offer broader financial-planning services."

In a word, I agree. Your car sales person will give you car purchasing advice as well, but anytime someone advises AND sells it tensions the pull between serving the client and the firm. Sometimes these interests align but don't count on it. The board governing the Certified Financial Planner designation has gone back and forth about raising its standard to the fiduciary level, but it will probably only happen when enough people walk into offices prepared to ask, "Are you a fiduciary to your clients?"

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