Why AUM Pricing is Fair for Fiduciaries and Clients

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When I accept my client’s plea to serve as a fiduciary, I accept their concerns as my own. I stand in their shoes and make the best decision with known information. If I don’t know what’s best, I seek input from someone who does, even hiring others on their behalf if that is the best choice.

Responsibility is the heart of a fiduciary relationship.

Let’s consider an example or two. Let’s say a client is leaving the continent. They’re going to start a company in New Zealand with a friend, and are unlikely to be back in a few years. They own a house here and expect to return here again when their adventure is done. They need a caretaker.

They call me. Would I look after their house in their absence? Rent it to suitable tenants, deposit the rent checks, hire a plumber or roofer if needed, check the inside and outside occasionally for damages or problems. Seems simple enough; I live nearby in a similar cottage and I’m a responsible fellow with both money and property.

We agree to a modest stipend for my service, and of course, I’ll be reimbursed for any expenses incurred. We both agree that they’ll keep the place properly insured and I’ll be their local point of contact whenever needed. It’s a simple agreement that satisfies both of us. I’m pleased to accept the responsibility.