When selecting a financial advisor, it’s critical to understand the different types of advisors. There are advisors who are employed by independent financial advisory firms, such as LS Wealth, and advisors who are employed by big-box brokerage firms. The advisors who are employed by independent financial advisory firms operate under the fiduciary standard, while advisors who are employed by big-box brokerage firms operate under the best interest standard.



(The Suitability Standard)

Offers products for sale from a range of products carried by the company he or she represents.

Is paid commissions calculated as a percentage of the amount of money invested into the product



(The Fiduciary Standard):

Offers “best advice” taking into account the needs of each individual client

Is paid a fee calculated as a percentage of the assets under advisement

The Fiduciary Standard Requires Advice to Be Provided in The Best Interests Of The Client Including The Disclosure Of Possible Conflicts Of Interest. 

An advisor with a fiduciary obligation is legally required to put a client’s best interest over their own interests. That means the advisor represents the client in every investment transaction, not just as the provider of certain financial investment products. Fiduciary advisors are also prohibited from engaging in undisclosed conflicts of interest or self-dealing. Fiduciary duty includes care and loyalty to the client as well as full and fair disclosure of material facts and any conflicts of interest.

In contrast, advisors who operate under the best interest standard must use reasonable diligence, care, and skill in making investment regulations. While they are required to act in their client’s best interest at the time of specific transactions, they aren’t held to this standard in all aspects of their relationship with their clients. Regulation Best Interest also requires advisors to provide appropriate disclosures to clients when they make recommendations and establish and enforce policies around conflict of interest.

Why should you care?


When it comes to hiring a financial advisor, many investors focus on aspects such as performance, personal compatibility or a personal connection. However, making a decision based on these or other considerations ignores the biggest issue that every investor should consider when hiring an advisor – whether that advisor has a fiduciary duty to their clients – or not. Advisors who possess a fiduciary duty to their clients are required to put their clients’ best interests above their own. Many Americans are shocked to find out that this obligation isn’t required of all advisors. In fact, most advisors aren’t required to act as a fiduciary in all their interactions with a client.

Out of the 690,188 financial advisors who were registered in the U.S. in 2019,  the shocking truth is that less than 10 percent of all financial advisors in the United States follow the fiduciary standard, which legally requires financial advisors to put your interests ahead of their own.  LS Wealth Advisors follow the Redefining Wealth Process℠. This step by step process ensures full transparency and detail to clients for all recommendations.


Schedule a Complementary Consultation with Our Financial Professionals