By Gregory Warren Smith, CFP
I have just told a client about difficulties I’ve been experiencing in my personal life. I was vulnerable and looking for comfort, maybe even pity. The client, whom I’ll call Fiduciary Fred, responded with a grin and a happy clap of anticipation.
“I am so happy for you!” he exclaimed.
Huh? I was shocked, wondering if Fred was listening. I asked what he meant. “You are about to undergo such personal growth and change and insight; I can’t wait for you to come back and tell me how this all ends for you,” Fred exclaimed. “It’s all so exciting!”
The power of perspective
Though confused at first, I recognized that Fred, a Holocaust survivor whose parents and many of his family members had been killed in Nazi concentration camps, had experienced so much more tragedy than I had. Fred had gone through a painful and years-long process of relocating across multiple countries and continents and supported his family in a new place through work ethic and entrepreneurship. There was no comparing Fred’s experience with mine, but I realized that Fred both knew it wasn’t his place to provide answers and that I would have the strength to gain perspective.
I always knew that I was in a fiduciary relationship with Fred. What I had never realized, though, was that Fred was taking fiduciary care of me. He didn’t recommend what was in his best interest. He didn’t insist that I do things his way, or any way, for that matter. He didn’t try to sell me anything. What he did was instill in me the courage and strength to grow out of my darkest periods and to embrace that growth and change with a newfound excitement.
U.S. Department of Labor regulations
With the U.S. Department of Labor’s pending regulations that focus on the fiduciary standard of acting in the client’s best interest, I appreciated my relationship with Fred, who always focused our meetings around a meal and conversation. The vast majority of our time together was spent eating and conversing, rather than doing business.
The reason I was there was that they had entrusted me as a family confidant, and so, in some way, I became a part of their family. That included being a part of non-financial issues as well. Whenever it came time for the financial business decisions, the answer was always: “Do whatever you think is best.”
This is at the heart of what most fiduciary relationships are based upon. That interest becomes very real and very deepened when the time is invested to truly understand your client and develop a mutually deep relationship. Fred never allowed me to move on until we first spent time finding out about more each other. He made sure we updated each other on what had transpired in our lives since the last time we had met. He did not want to fill out a checklist. Fred knew that the more he got to know me, and the more I got to know him, that acting in his best interest would never be in question.
Likewise, whether there is much or little to change to comply with the DOL regulation, it is an opportunity to choose to see the world like Fred. I am so very, very happy for advisors going through this. They are about to undergo such personal growth, and change, and insight. It’s so exciting!
Smith is a three-year MDRT member from Louisville, Kentucky.
Contact MDRT to submit a blog post.