More than 90 percent of independent financial advisors said the Department of Labor should not redefine the meaning of fiduciary to ban the giving of IRA advice for a fee, a poll released Thursday by the Financial Services Institute found.
The number against the change (91 percent) was unchanged from last year. Last month, the U.S. House voted, largely along party lines, to delay new fiduciary rules.
“Financial advisor opposition to the Department of Labor's fiduciary definition proposal has … held strong over the past year. The redefinition could ban the earning of a commission on IRA advice, pricing millions of middle class investors out of the market for affordable retirement advice,” said FSI President and CEO Dale Brown in a statement.
The effort to rewrite the definition of fiduciary stems from the 2010 Dodd-Frank Act, which called on the SEC to codify a single fiduciary standard of conduct for both broker-dealers and investment advisors. The Labor Department has been working on its own standards. The House bill called for the departments to work together.
Proponents of the expanded definition argue that it would help small investors by eliminating conflicts of interest.
FSI, which surveyed 2,500 independent financial advisors for its survey, also found a split about whether the government shutdown and debt ceiling fight in Congress hurt clients with 46 percent saying yes and 54 percent no. Advisors were split equally on whether the amount of work they had increased because of those two battles.
As to whether the shutdown would lead to a so-called grand bargain on the federal budget before a January shutdown, just 7 percent thought that would happen. About three-quarter (77 percent) said Congress would kick the can down the road with another short-term resolution, while 13 percent expected another shutdown.
The path to a budget deal revealed another split among advisors. Those favoring only spending cuts totaled 55 percent, with advisors wanting tax hikes at 1 percent. But 46 percent said both measures would be needed.
Nine in 10 advisors thought the economy would stay flat or recover in 2014, with most, 57 percent, seeing no change. The same was true for expectations about equities, with 59 percent expecting a neutral year and 30 percent saying it would be strong.
FSI also asked advisors if they had a business succession plan in place. More than half, 57 percent, said they did.