Get these Republicans off of me
(/s/ Retirees Seeking Best Financial Advice)
The Department of Labor (DOL) has finalized rules that require financial advisers who help people make investments for retirement to put their clients’ interests ahead of their own. But House Republicans aren’t letting the rule go into effect without a fight.
The GOP-run House voted on a resolution (H J RES 88) that would effectively block the new rules, which require advisers to adhere to a “fiduciary standard,” that passed along strict party lines, with 234 Republicans voting yes and 183 Democrats voting no. Republicans claim that the rule will make investment advice more expensive.
Investment advisers are bound to a fiduciary standard that was established as part of the Investment Advisers Act of 1940. They can be regulated by the SEC or state securities regulators, both of which hold advisers to a fiduciary standard that requires them to put their client's interests above their own.
That practice was costing Americans billions before the new standard. Financial advisers were only required to give “suitable” advice, which left the door open for them to steer clients into products that made the advisers more money but weren’t the best option.17 billion a year in conflicted advice, according to the White House. Some people say their finances, particularly their chances of retiring comfortably, have been destroyed by bad advice and that they would have simply been better off without it.
Americans have little wiggle room for losing money when it comes to saving enough for retirement. Pensions, which guarantee payments in old age, have been overwhelmingly replaced with 401(k)s, which require individual workers to make smart investment choices in order to have enough to live off of when they stop working. And by and large workers aren’t putting enough aside. The gap between what they should have saved up and what they’ve actually put away is $6.6 trillion. Meanwhile, about 60 percent of working age people have no retirement savings at all.
The House vote, however, is a largely symbolic since the resolution to have any power would have to be taken up and passed by the Senate and sent on to President Obama to sign it into law. But is unlikely since he has already threatened to veto such a move.
So, who still says the GOP stands with hard-working Americans who are at or near retirement and seek the best retirement investment advice?
Well, it sure ain’t the Grand Old Poops, so don't bother to look there for help.