Retire On Your Terms

FINRA’s Suitability Rule: What Investors Need to Know

Meeting with a financial advisor may seem to some like an invasive experience. Questions are asked that you might not feel comfortable answering, even if your advisor was your best friend. Take comfort in knowing there is a good reason financial services professionals prod about your risk tolerance, investment experience and the like. Financial Industry Regulatory Authority’s (FINRA) suitability rule (FINRA Rule 2111) helps explain how an investment professional “must have a reasonable basis to believe” that a transaction or investment strategy involving securities that they recommend is suitable for the customer. Without an understanding of the investor’s situation, the advisor could do no such thing.

CLICK HERE to learn more about FINRA’s suitability rule and what sort of questions you can expect an advisor to ask you.

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