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Regulation Best Interest and Rollovers

The Department of Labor (DOL) has indicated that its future fiduciary rule will follow similar lines as the Security and Exchange Commission (SEC) Best Interest Rule in its application to retirement plan rollover transactions. The best interest standard will apply to advisors who provide recommendations regarding rollovers from employer-sponsored plans into IRAs in that the advisor must establish that the rollover is in the client’s best interest. This can be accomplished by showing how the advisory services served to add value to meeting the client’s goals, with consideration given, but not limited to fees and expenses, available services in both the retirement plan and IRA, available investment options, impact of minimum required distribution rules, and retirement plan provisions (holding of company stock, creditor protection).; July 3, 2019.