How will the U.S. Department of Labor’s proposed fiduciary rules affect your business?
The proposed regulations from the Department of Labor – to me it shows the value of NAIFA and how we’ve been able to rally the troops and use our representation and the work that we’ve done in the past to our advantage in Washington. It’s a little bit new for us. Primarily in the past we’ve worked with legislators. In this scenario having to work with regulators is a little bit different than what we’ve done in the past but with the representation and the image and our history representing the best interest for ourselves – not only ourselves but also our clients – has given us credibility and opened a lot of doors for us in the regulatory world that formerly we’ve not needed to get into or we’ve not had to go through. It’s paid off a lot in getting access and getting credibility and the standing, so that’s helped us to this point.
This proposed regulation on the fiduciary standard – this is one of the biggest challenges that we’ve faced in some time. It could really change the landscape for probably 60 percent to 70 percent of our members who are registered and do work in that market so it’s big … and it could force a lot of us out (of the business). It’s pretty serious.
- Doug Massey, chartered financial consultant, San Angelo, Texas
“It scares me to death. I understand that the intentions may be well-meant and that they want to help the investor as a whole, but the fact is they are really going to hurt the investors. Within our agency – and we work with a lot of small- and medium-sized clients where we roll over $20,000, $50,000, $100,000 a year and we’re very active in the 401(k) business and I see that all the time and – if it goes through in its current form, it may make it unrealistic for me to service some of those people due to the costs, paperwork, etc. that’s involved. Hopefully I don’t have to tell them anything. We haven’t crossed that bridge yet. I’m still very hopeful. I’m very involved in some of our advocacy efforts. I’m still very hopeful that we can find a resolution or at least some wording that’s not as harmful to the client. Again, it’s not me I’m worried about, it’s the client I’m worried about.
- Thomas O. Michel, managing director, Michel Financial Group, Los Angeles
“Of course, the reason why NAIFA’s against it is because of the effect that it would have. I feel like individuals need an advisor and there are so many things they (the DOL) want to disclose and not disclose – that part I don’t think is necessary. I just think we need to have a one-on-one. I feel like NAIFA’s stand is a good stand and I support NAIFA’s stand. I think we need to service all (clients) and in my market I deal with a lot of the lower level (clients) so I definitely need to keep those relationships. I get more lower-level (clients) than higher level, some intermediate level and I do have some of the high top-type deals, so I definitely need the relationship with the lower levels. Definitely, it would have an effect because, of course, a lot of it is a lack of understanding. They don’t really understand what we do and the importance of it.
- Priscilla King, Priscilla G. King Agency, Columbus, Miss.