Tags: fiduciary | rules | regulation | retiree

Less Regulation May Mean Retiree's Best Interest Is Last in Line

Less Regulation May Mean Retiree's Best Interest Is Last in Line

(Getty/Christopher Furlong)

By    |   Thursday, 15 December 2016 08:55 PM


The Trump administration selected Andrew Puzder to lead the Department of Labor.

Puzder (the chief executive of CKE Restaurants, the parent company of Hardee's and Carl's Jr.) has been a fierce critic of regulation. From raising minimum wage to expanding access to overtime pay, the CEO has been against many attempts at regulation.

Now, whether or not we all have the same opinion on minimum wage or overtime, I think we can all agree on one thing. That one thing is that when we get advice from someone, we want to be sure that the advice we are receiving is in our best interest, not someone else’s.

So here is where the problem lies. For many years the Department of Labor has tried to form a rule to make sure that all retirees are getting advice that is in their best interest. The reason is that there are many people out there, who by law, do not have to act in the best interest of their clients.

Yes, believe it or not, this is true! Could you imagine bringing your car in to get an oil change, and instead of using the regular oil for $30, the mechanic uses $300 oil simply because he gets paid more?

How about going to the doctor, who gives you a prescription for a $150 treatment even though the over the counter version will work just as well but cost you half as much? Is that in your best interest?

Finally, after years of lobbying by special interests, the Department of Labor was successful in creating the Fiduciary Rule, which will make all retirement advisors act in the best interest of the client.

The only problem is that the rule is not scheduled to be enforced until January 1, 2018.

That is, if it isn’t scrapped in total. From banks, to the EPA and the environment, the Trump administration has been clear that it does not prefer regulation.

But what if the regulation was to ensure that your best interest is in mind? Then I think we can all agree that this regulation is worthwhile and worth keeping to ensure that what retirees have worked for their whole lives is protected.

So what can you do? If you do chose to receive advice, make sure you work with someone who is a fiduciary and will put your interests first.

Work with a CFP – Certified Financial Planners have gone through a rigorous, one year educational program far more in depth than what most brokerage firms offer.

Work with someone who can do it all. “Sometimes if all you have is a hammer, everything looks like a nail.” Advisors who have both securities and insurance license will advise you how to blend the two areas together to create financial independence.

Dennis Notchick, CFP is a Registered Investment Advisor Representative and Certified Financial Planner with Safeguard Investment Advisory Group in San Diego, Calif. He has nearly a decade of experience as a financial professional, and holds Series 3, 7, and 63 and 65 Securities Licenses and a California Life/Health Insurance License. Notchick has a Bachelor’s degree in business administration from California State University Northridge.

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The Department of Labor was successful in creating the Fiduciary Rule, which will make all retirement advisors act in the best interest of the client.
fiduciary, rules, regulation, retiree
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2016-55-15
Thursday, 15 December 2016 08:55 PM
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