Most financial advisors offer their clients casualIRA advice, which can take severalforms.

The most common form is to integrate IRAs into a client's assetallocation program or portfolio review process. Other forms ofcasual advice include: suggesting conversions from Traditional toRoth IRAs, providing calculations or advice on minimumdistributions, and advising on beneficiary changes.

None of these services typically generate new assets undermanagement, product sales, or commissions – so they are not verylucrative for advisors. However, they can help to build clientrelationships and make clients' retirements more successful.

Most clients appreciate casual IRA services and are willing topay for them, often through trail commissions. Under theDepartment of Labor's ERISA fiduciarydefinition, casual IRA advice compensated by trailswill need to fall under the Best Interest Contract (BIC) exemptionto continue.

That could mean increased liability, warranties and feedisclosures for financial firms and advisors.

Now that the DOL's adoption of the rule is finalized, you willwant to examine your full book of IRA business and make strategicdecisions.

You probably will be able to decide, on a client-by-clientbasis, whether or not to use the BIC exemption. Unless you areearning a threshold amount of trails from a client for casual IRAadvice (e.g., $500 per year), it may no longer be prudent tocontinue as the advisor-of-record on these accounts.

The extra liability and work mandated by the BIC exemption willbe too onerous to continue offering these services as aloss-leader.

Taking your name off the account and giving up the trail doesn'tmean you must cast these clients and their IRAs adrift. Forexample, you can continue to offer clients IRA education,unconnected to investments or financial products.

You also can form a partnership with another advisor willing tooffer casual IRA advice under the BIC exemption, with theunderstanding that the partner will respect your clientrelationships.

For some clients, it may be feasible to move casual IRA advice(as well as other services) under fee-based advisoryrelationships.

It's not too soon to talk with selected clients about casual IRAadvice, and let them know your thresholds for continuing theseservices. Some clients may choose to consolidate additional IRAassets with you, to achieve the compensation you need to continueadvice.

The clearer you are in setting and communicating your thresholdincome levels for casual IRA advice, the better. It's alsoimportant to let clients know why the relationship is changing –e.g., because DOL has decided IRA investors need more U.S.Government-mandated regulatory protection.

Read the DOL's fact sheet on the re-proposed ERISAfiduciary rule.