Fiduciary Advice Regulations

The New DOL Fiduciary Rule

On June 9th of this month, the Department of Labor’s Fiduciary Rule went into a phased implementation period with an effective date of January 1, 2018. The rule was designed to protect investors’ retirement savings. While the rule is thousands of words long, the main focus is this: require anyone providing investment advice to individuals…

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Video – The Difference Between Fiduciaries and Brokers

Over the past few years, I have become a big fan of whiteboard illustrations that simplify concepts which can be challenging to understand. The video below by HighTower Whiteboard Animation does a great job of simplifying the confusion over the difference between brokers and a fiduciary in a nice little analogy. Can’t view? Click here…

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fi360 Webinar Recording: The Combined Effects of the DOL’s Proposed Advice Regulation and 408(b)(2)

CEFEX and fi360 sponsored attorney Fred Reish to provide a thorough overview of the proposed advice and 408(b)(2) regulations. If you are a plan fiduciary who has hired a person or firm to provide your employees advice on their 401k, or an advisor/broker that works with 401k participants, this is essentially a must-listen event. The following were a number of interesting points which affect plan sponsors and advisors:

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Final Regulation on 401(k) Advice Bill Due Early 2011

Even though it has been in the works for over four years now, it looks like we might finally receive clarification on the PPA ‘Fiduciary Adviser’ 401(k) advice regulations early next year. Understandably, with the many issues that have garnered more press such as the healthcare debate, 401(k) fee disclosure and target date funds, the regulations have been delayed.

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A Conversation on 401(k) Advice vs. Guidance – PPA Fiduciary Adviser v. The DoL 96-1 Opinion

When marketing our services to companies sponsoring 401(k) plans, we will often face confusion as to what is truly being offered to participants, guidance or advice. The reason being that the word advice has been used liberally by brokers, advisors, and service providers. Unfortunately, that will sometimes lead to companies assuming their participants are receiving the advice they need, rather than knowing what is actually taking place in those education meetings and any 1on1 interactions that follow. The guidance versus advice being so unclear, that the following is a mock conversation designed to educate plan sponsors and advisors as to what is and isn’t, should and shouldn’t, be taking place with participants so to protect the plan sponsor from fiduciary liability:

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4 Ways the New 408(b)2 Disclosure Regulations Will Benefit Plan Sponsors

The new 408(b)2 disclosure regs have been long awaited, and present a great opportunity for companies to better understand and benchmark the fees associated with their 401(k) provider. Additionally, it will be require 401(k) service providers to better articulate value in light of the fees they charge. ERISA requires plan fiduciaries to review the fee structure of, and I paraphrase, “reasonable fees for reasonable service.”

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BeManaged Cited in Congressional Testimony Regarding 401(k) Advice

Our friend Matthew Hutcheson, Independent Fiduciary, recently conducted testimony with the Congressional Ways and Means Committee. The goal of the testimony was to discuss the need for fiduciary best practices to continue to be reinforced with 401(k) plan sponsors as well as avoiding the potential conflicts of interest inherent to the broker dealer model.

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Thoughts on 401(k) Advice Session from fi360 National Conference (Presentation Included)

For the third straight year, I attended the fi360 National Conference, the premier fiduciary-focused conference in the nation. The sessions were outstanding, focusing on the many changes taking place within the retirement plan industry, including those proposed for 401(k) advice. I was fortunate enough to be able to speak on an esteemed panel regarding the topic to a packed house of concerned advisors and retirement plan providers. Here are some key points that were discussed:

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DoL to Issue New 401(k) Advice Rule Potentially by the Fall

The comment period for the DoL’s new 401(k) advice period ended on March 5th, and the 70 response letters will be under consideration by the Employee Benefits Security Administration. Financial-Planning.com reported that the Department could have the rule on advice finalized as soon as this fall. Though it might end up being four years since the PPA was passed before this rule is finalized, it should be worth the wait for 401(k) investors due to its conflict-free, fiduciary approach.

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