Retirement Advice Standards in the News - A Letter to our Clients

April 6, 2016 - You may have heard about new Department of Labor (DOL) rules due to go into effect this year that clarify the fiduciary responsibilities of advisors who work with individuals and their retirement accounts. The new regulations won’t alter the standard of integrity and care we at Summit Wealth Group have always offered, and we doubt you’ll notice any significant difference in the way we work together. But because this issue may have come to your attention in news stories, we thought we’d offer a brief explanation of the regulations, which have just been published.

The impact of the rule

The DOL has jurisdiction over many programs designed to enhance and protect the welfare of retirement investors. Up until now, the agency had focused mostly on the fiduciary responsibilities of pension fund managers. Today, however, more and more Americans rely on IRAs, 401(k)s, and other workplace retirement plans, as well as pensions, to fund retirement and are turning to financial advisors to help them with investment decisions. To address this reality, the new DOL regulations extend the fiduciary role to advisors who offer advice to individual retirement investors like you.

As our client, you’ll likely see little change

All account advisors and representatives who manage IRAs are now required to be fiduciaries. This means they must act in the best interests of their clients when providing savings and investment advice. Previously, registered representatives with broker/dealers were not held to the legal standard of a fiduciary. We have always tried to adhere to the fiduciary standard regardless of industry regulations—acting in your best interest—so we don’t believe the new rules will change our interactions appreciably.

As the specifics of enacting the DOL rules become clear, it seems likely that we may be required to provide you with additional paperwork and disclosure for certain investments. It is also possible that the DOL rules will prevent us from offering you certain types of investments within your retirement accounts. Our broker/dealer–RIA, Commonwealth Financial Network®, will help us determine exactly what we may need you to sign or review, as well as what restrictions may be placed on our ability to recommend certain products in your retirement accounts, as the regulations take effect.

In the meantime, please feel free to reach out to us with any questions about your financial well-being.