Fiduciary Standards

Personal Experience Raises Advisor’s Awareness of The Unknown

After all, he was a registered investment advisor – a fiduciary’s fiduciary; an advisor dedicated to putting all of his knowledge and skills to work for the best interest of the client.

Bryan Burkhart was transitioning from working for another registered investment advisory firm to establishing his own investment advisory practice as the president of Burkhart Investment Group based in Morgan Hill, California which offers investment advisory services through Global Retirement Partners, a registered investment advisor. He knew that all of the angles had to be covered, reconfigured and covered again.

And then the unthinkable – the thing he often warned his own clients about – happened to him. More specifically, it happened to his wife. At age 48, she had a hemorrhagic stroke. She was paralyzed on her right side. She needed constant, 24-hour care. She faced a year of recovery that involved eight hours a day of physical therapy five days a week.

That wasn’t in his plans for opening Burkhart Investment Group.

“I had planned meticulously to open a new firm. I had set aside the correct amount of money. I had planned what I thought would be every worse-case scenario, but it didn’t even come close,” Burkhart said.

What his wife’s situation did do was significantly raise his awareness that he needed to know more about his clients’ lives than just what is happening in their bank accounts. Not only did he need to know – he wanted to know – what was happening in their lives beyond the dollars and cents.

bb 6x9 colorHe quickly transitioned from merely creating portfolios that created retirement funding to an advisor taking a much more comprehensive approach.

“It made me realize that I had to focus on every aspect of everything going on in the client’s life,” Burkhart said. “I had to focus on not just the financial portfolios but also focus on what to do – as their fiduciary – for their health care, life insurance, long-term care, disability insurance and care of their loved ones. I wanted to get more involved. It caused me to completely rethink the relationship I have with clients.”

That included ramping up what was already a rather progressive approach toward teaching clients the true meaning of fiduciary. Recent moves by the federal Department of Labor to enforce a blanket-style fiduciary standard across the financial services industry added to this prompt.

A recent meeting in which Burkhart and another financial advisor representing a broker-dealer firm made pitches to run a company’s 401K plan only further highlights his concerns that clients might not fully understand the meaning of fiduciary.

“I gave a detailed explanation of the fiduciary responsibility, and the other advisor said he would offer the same level of oversight but I knew he was prohibited by his employer to do such,” Burkhart said. “There is still a marketing spin to the word fiduciary. What is important is to dig even deeper now to help clients become fully aware of what that means. It comes down to who is willing to put it in writing and define what it means to be a fiduciary.”

Learn more about Bryan Burkhart and his firm, Burkhart Investment Group, online at www.burkhartig.com

 

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