This year's biggest controversy in financial services may focus on a crusade by the Department of Labor to subject IRA accounts to an ERISA fiduciary standard. Despite fierce industry opposition, the DOL has vowed to press ahead with rule-making, with a final proposed rule expected in April. The proposal would force advisors who wish to be compensated for IRA advice and services to become fee-based. Without DOL compromise, the proposal could effectively end commission-based advice in this huge market, which controls about $5 trillion.

One potential obstacle appears to remain for the DOL, which is to adequately support its very limited estimate of the proposal's implementation cost. In 2011, the legal counsel for Primerica hired regulatory experts Daniel R. Fischel and Todd D. Kendall to create an alternate, industry-generated cost estimate. Their detailed analysis focused not just on the industry's compliance cost but also on the extra fees and lost investment opportunity cost investors may incur, especially holders of smaller IRAs. You can evaluate it here: http://www.dol.gov/ebsa/pdf/1210-AB32-PH056.pdf

Whatever the outcome, you can help clients prepare for changes in the IRA market by consolidating several like-kind IRAs (traditional or Roth) into one. Consolidation will help to streamline any paperwork required to change accounts to fee-based, and it also may give clients better economics in fee-based fiduciary accounts. IRA consolidation has always been a good idea for clients approaching retirement, because it assists with income planning and meeting minimum distribution requirements. Now, it's also the best way clients can prepare for potential regulatory change.