Posts Tagged ‘401k advice regulation’
New 401(k) Advice Proposal Available for Comments Until May 5th
As promised, the new 401(k) advice proposal has been delivered before the end of the month. While I admit to not having read it in its entirety, the following has been reported by the Wall Street Journal:
Read MoreA Model for 401(k) Advice, Pt. 1 – Must be Conflict-Free
Many 401(k) sponsors, providers and advisors eagerly await the DoL’s new advice proposal, which is due to be released within the next 30-45 days. In an effort to put in our two cents, we thought we would share our hopes for the proposal based on our experience in delivering advice, our understanding of other options in the marketplace, and the feedback we have received from employers and investors alike. Keep in mind most of our clients exist in the top end of the small market (250+ employees) to large sized employers (1,000+ employees).
Goal #1 – Advice Must be 100% Conflict-Free
We believe advice for 401(k) investors must be start with being conflict-free. If there are conflicts in providing participants advice, then 401(k) advice is doomed to fail. So, let’s look at how to ensure this holds true for participants and the employers that are required to do their due diligence on service providers, including advice providers.
New 401(k) Advice Rules Set By End of February
The Department of Labor has declared their hopes for releasing the provisions for 401(k) advice by the end of February. Fair warning: The PPA was passed 4 1/2 years ago, and they still have not finalized said provisions. However, after the DoL was a bit embarrassed by the industry backlash by the legal, consumer protection and fiduciary experts, I actually feel optimistic they will get it right this time. In reading Phyllis Borzi’s comments below, we are hopeful the provisions will look something like this:
Read MoreW MI Fiduciary Forum Ruffles Feathers of Local Brokers
Last October, we organized the West MI Fiduciary Forum, a follow up to the ’07 Fiduciary Roundtable, a highly successful fiduciary education event that over 70 professionals attended, including 401(k) and 403(b) plan sponsors, investment providers, TPA’s, brokers and advisors. While the name Fiduciary Roundtable has been changed to Fiduciary Forum (Fiduciary RoundTable has been trademarked), the purpose of the event did not.
Read MoreREGULATION: New deadline granted for advice bill
After throwing the early ’09 DoL proposal in the trash, which would have allowed for conflicted advice to be delivered to 401k investors, there is some urgency in getting this done. Fast. And right.
Read MoreYouTube: 401(k) Fair Disclosure for Retirement Security Act of 2009: Rep. Miller
How picky is picky? Advice regs an unknown – Investment News
A hybrid of these regulatory offerings could be just want investment-advice-hungry 401(k) participants ordered, but we will have to wait and see.
Read More401(k) Participants Need Credible Advice, and Quickly
It’s no surprise to anyone that 401(k) investors need help, or should I say NEEDED help during the historic volatility we have experienced since the fourth quarter of ’07. During that time, mutual fund companies, insurance companies, and the broker dealer world has been fighting over providing advice to those investors.
Read MoreGrand Rapids 401(k) Expert is Featured Panelist at ’09 CFDD National Conference
The lingering and wide-reaching impact of the economic crisis and impending financial planning/services industry regulatory overhaul were at the forefront of this year’s fifth annual Center for Due Diligence, or CFDD, National Conference in Scottsdale, Ariz. Chad Griffeth, an Accredited Investment Fiduciary designee from BeManaged | Actium, was among those attending the three-day educational event, focused on lessons learned from the uncertain times, more ways to implement fiduciary practices and what to expect going forward with the current efforts to make rules, regulations and enforcement more consistent and create greater safeguards for investors.
Read MoreConflicting Interests – DoL 401(k) Participant Advice Rule May Not See Light of Day 1/29/09
“The controversy exists in that the person delivering the advice must adhere to specific fiduciary criteria, but their affiliated firm, whether that’s a broker-dealer, mutual fund company, insurance company, or bank, does not,” said Griffeth. The new rule “opens the door for conflicts of interest to exist on the part of brokerage firms and mutual fund firms at the sake of participants, whom I fear wouldn’t know what questions they should ask to ferret out conflicted advice.”
“…In essence, he said the broker- dealers, insurance companies, banks, and mutual fund companies could play “puppeteer” with the advisers that are meeting with participants to benefit their own pocketbooks, not the participants.” – Chad Griffeth, BeManaged | Actium
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