What’s the difference between a doctor, a lawyer, and a financial adviser? It may sound like a bad joke, but it’s a dead serious question.
When you go to a doctor or a lawyer, you expect that the advice you get is in your best interest. That’s because lawyers and doctors have an obligation to look out for what’s best for you.
Right now, the same simply doesn’t hold true when it comes to saving for your retirement.
Trusted retirement advisers who provide critical financial advice every day are not always obligated to look out for your best interests. They can steer you toward high-cost, low-return investments instead of recommending quality ones, because it means back-door payments for them. Meanwhile, you’re stuck with hidden fees and lower returns that could cost you tens of thousands of dollars over your lifetime.
Watch this video to get a quick breakdown of the problem:
That’s simply not fair, and we are working to change it. Under the President’s direction, the Labor Department will publish a proposed rule in the coming weeks that will require retirement advisers to put the best interests of their client above their own financial interests.
Many advisers already do. They are hardworking men and women who got into this work to help families achieve their dreams. But outdated rules and fine print make it hard for these advisers to compete — and for middle-class families to know who they can trust.
What the department is doing is based on a simple premise: when you’ve worked hard to build up a retirement nest egg, you’ve earned the right to sound advice. You deserve to know that your adviser is working for you. More than that, you deserve to know that they have a clear legal and ethical obligation to look out for what’s best for you. That’s just common sense and basic fairness. After a lifetime of hard work, every American — no matter what their income level — deserves a shot to retire with dignity.
Once the rule is published, we’ll accept public comments and hold a public hearing to discuss the proposal. That means you — and any member of the public — can share your insights and be a part of the conversation.
Get the facts and learn more at dol.gov/ProtectYourSavings.