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Understanding the Department of Labor Fiduciary Rule

You may have heard a lot about the Department of Labor (DOL) Fiduciary Rule in the news. But do you know what it means for you, as a consumer? Here’s what you need to know.

The DOL fiduciary rule requires financial professionals to work in their clients’ best interest. Under this rule, among other things, financial professionals are required to disclose any fees associated with qualified retirement accounts, as well as how they are compensated for sales related to these accounts. They are required to act as a fiduciary.

What is a fiduciary?

A fiduciary is an individual who has a legal or ethical relationship of trust with an individual or a group of people.

What types of accounts are affected by the DOL Fiduciary Rule?

Qualified retirement accounts, including, but not limited to those listed below, are affected by the new regulations:

  • 401(k)
  • Roth 401(k)
  • IRAs
  • Defined Benefit Plan
  • Money Purchase Pension Plan
  • Profit Sharing Plan
  • ERISA 403(b) Plan
  • SEP Plan
  • SIMPLE Plan

When does the DOL regulation take affect?

Some portions of the rule took effect June 9, 2017. Additional portions of the rule are scheduled to take effect January 1, 2018.

If you have specific questions or concerns about your retirement plan, or want to work with a trusted partner to help you navigate your financial future, get in touch with a financial professional.