The rules are expected to have a far-reaching effect on the industry, according to Kevin Keller, CFP Board CEO.

“When we make changes to standards it imposes a significant obligation on firms to adjust their practices. The rules apply to the nearly 80,000 CFP professionals, but firms do not have two sets of standards: one for CFP designees and another for other advisors. They have one set of standards.

“We want to raise the bar for the financial planning profession by making sure they adhere to a fiduciary standards when providing financial planning, but at the same time making sure real world practice is taken into consideration,” he added.

Some of the changes made following the comment period, such as delaying when detailed information needs to be revealed to a potential client, were made because of the comments received.

The new rules define a fiduciary as one who:

• places the interests of the client above the interests of the CFP professional and the CFP professional’s firm.
• seeks to avoid conflicts of interest, or fully discloses conflicts to the client and obtains the client’s consent.
• acts without regard to the financial or other interests of the CFP professional and his firm.

The fiduciary also is required to work towards the client’s goals and follow the client’s instructions.

“The cat is out of the bag as far as the public is concerned with financial planners being fiduciaries,” Keller said. “The public now expects advice to be delivered that is in their best interests.”

The CFP Board said in written comments that accompanied the rules that strict requirements to adhere to a fiduciary standard will not limit the advice available to low-income people.

The CFP Board "does not believe that the proposed fiduciary standard will negatively affect the availability of advice or the range of products for moderate- and low-income consumers. To the contrary, small account holders and moderate-income investors stand to benefit most from a fiduciary standard [because] financially unsophisticated consumers are most at risk of receiving financial advice that is not in their best interests,” the board said.