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What would the proposed Department of Labor Retirement Security Rule do?

The DOL proposal would close current regulatory loopholes:


It would cover rollover recommendations to ensure that retirement savers receive strong protections when they are most vulnerable to receiving conflicted advice that harms their financial security.

The proposal would apply to all retirement investments, including not only securities but also non-securities such as many insurance products and a wide range of other investments not currently covered.


The proposal would cover advice to employers who sponsor 401(k) plans to ensure that the advice they receive about the menu of 401(k) plan investment options they should offer to their employees is not tainted by conflicts of interest.

Under the proposal, a person who makes an investment recommendation in one of the following contexts would be a fiduciary:

(1) The person has discretionary authority or control over the retirement saver’s investments;

(2) The person makes investment recommendations on a regular basis as part of their business and the recommendation is provided under circumstances indicating that the recommendation is based on the particular needs or individual circumstances of the retirement investor and may be relied upon by the retirement investor as a basis for investment decisions that are in the retirement investor's best interest; or

(3) The person represents or acknowledges that they are a fiduciary.

The proposal is designed to ensure that ERISA's fiduciary standards uniformly apply to all situations where retirement investors reasonably expect that their relationship with an advice provider is one in which the investor can—and should—place trust and confidence in the recommendation.

That means:

If you leave a job and need advice on whether to roll your 401(k) over into an IRA, the financial professional will have to analyze your former employer’s 401(k) and the available IRA alternatives to determine whether rolling over your money is best for you.

Any advice you receive about how to invest the money in your 401(k) or IRA will have to be based on sound investment principles and your specific financial situation. In short, it will have to be based on what is best for you, not what earns the most in commissions and fees for the adviser.

If financial professionals put your interests first, your costs should come down and your investment performance should improve. Over the long term, that could add up to tens or even hundreds of thousands of dollars in additional retirement savings.

Want to learn more?

Read fact sheets, comment letters, and other background information produced and compiled by the

Save Our Retirement Coalition.

Let's close the loophole for good.

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