It is a legally enforceable relationship with your investment managers: "A fiduciary financial advisor is a financial advisor who is legally and ethically bound by fiduciary duty to serve in your best interests"
This detail becomes important when various cons come around to bleed off your assets. Could be as simple as a "friend" hyping worthless pump-and-dump stocks, or a fund manager with ballooning fees.
In general, the lack of impulse control shown on YC seems to indicate this information is not that useful for many readers. Some people like being poor apparently lol =3
They’re mixing up a securities term (irrelevant to banking per se and cash management totally).
What they mean is getting an adviser who is bound to act as your fiduciary versus as a counterparty [1]. If you’re trusting your portfolio management entirely to a third party, they should be a fiduciary.
That said, people outside finance seem to make a bigger deal out of this than it is—in America if you’re a retail investor and you have a problem with a FINRA-member broker, FINRA arbitration will almost always side with the retail investor. Fiduciaries will tend to cost more (it’s riskier) and say no to you more; after all, you’re asking them to take decisions for you. I work in finance and couldn’t tell you which of my managers and advisers are fiduciaries because I double check what they say and limit what they can do. And this, again, has to do entirely with investments. Not banking.
More pointedly, this part is nonsense: "most people with under $2m in cash can't afford the bonded fiduciary services." What you want for cash management is yield (reward) and sweep (risk management).
> While phonetically similar to a "securities term", the conversation was about legal agreements with a registered professional
No. A "bonded fiduciary service" is not a thing. That's why there are literally zero hits on Google for that string.
You're thinking about an adviser--who must be a registered professional in the U.S., but that's a separate topic--who agrees to be bound as a fiduciary. (Bonding is a surety concept [1]. If someone is arguing their fiduciary duties are stronger because they're bonded, please report them to your regulators because that's nonsense.)
