A little over a week after the release of the DOL’s final 401(k) fiduciary rule to great fanfare, and the luster still shines for Terry Dune.
While the senior vice president and managing director of Millennium Trust Company first repeats what appears to be the new standard industry disclaimer, that the custodial firm is “reading it carefully and still trying to figure it out,” Dunne is nonetheless encouraged by what he sees.
“DOL did what they said they were going to do,” he says, echoing fiduciary proponent Blaine Aikin from days earlier. “They received comments, softened up the language and created a situation where it will likely help American families. It will cause advisors to put clients first. Kind of like mission accomplished.”
Arguing that they went out of their way to accommodate the concerns of detractors, “they didn’t tell them this is the law, they worked with them to address the issues in the final rule,” Dunne adds.
Oak Brook, Illinois-based Millennium provides custody solutions for IRA rollovers, alternative assets, and private funds. It reported $17.4 billion in assets under custody and 432,000 accounts under administration at the end of 2015.
While not everyone (unsurprisingly) is as enthusiastic as Dunne, he feels it’s” a spark for the next steps for consumers to pay attention” to important retirement issues.
“There is without a doubt a retirement crisis ahead of us,” he says. “It helps to reinforce the need to save money, and that advisors can help. It’s the start of a wake-up call; that the investments should be careful and appropriate.”
It wasn’t always this way, and like many others, Dunne was wary of initial reports about what was (and wasn’t) included in the rule.
“I would not have said this three or four months ago, but the DOL took out the sharp corners, listened and provided clarity,” he concludes. “It’s very significant. Every organization can set it up and do it however they want, they just have to comply.”
With more than 20 years serving financial markets, John Sullivan is the former editor-in-chief of Investment Advisor magazine and retirement editor of ThinkAdvisor.com. Sullivan is also the former editor of Boomer Market Advisor and Bank Advisor magazines, and has a background in the insurance and investment industries in addition to his journalism roots.