4 Ways to Make Sense of 401(k) Fiduciary Rule Confusion Now

What happens from here?

What happens from here?

The Department of Labor fiduciary regulations—and the media and political swirl over the past several months—has us all completely exhausted. An infinite number of hours have been spent wondering what’s coming next, or if anything is coming at all.

Whatever the eventual outcome, the public is more aware of the concept of fiduciary responsibility and potential conflicts-of-interest than ever before. Regardless of the changes that may or may not be implemented, this increased consumer awareness—particularly around advisor compensation—is causing an industry shift, particularly from commission-based to fee-based models.

Though the next few months certainly hold uncertainty, it’s important to remember several important best practices when reviewing your own business model, or choosing a service provider with whom to partner. These are the practices that should be the bedrock of your value proposition, and your adherence to them should be strongly communicated to clients and prospects.

We don’t know what the future holds for the fiduciary rule. The DOL may decide to keep the rule in place as originally proposed, modify it or repeal it entirely.

However, what we do know is that employers and employees value partners who are looking out for their interest, charge a fair price and strive to do right by them—regardless of whether the rules require them to do so or not.

Chris Dugan is the director of retirement plan communications at The Standard, with over 20 years of experience in the defined contribution industry. The Standard is a nationwide retirement plan record-keeper. Please call 844.239.3561 for more information.

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