All in, the Department of Labor's proposed fiduciary rule would mean between $2.4 billion and $5.7 billion in compliance costs for the financial services industry over 10 years, according to cost estimates within the agency's 200-plus page impact analysis, released in accord with the proposed regulation.
The DOL thinks most of that would be incurred by "new fiduciary advisers" in satisfying prohibited transaction exemptions laid out in the proposal.
Those costs are justifiable, the DOL says. Without the new rule, existing conflicted advice in the IRA market, strictly relating to mutual funds, will cost retirement investors up to $210 billion in lost savings over the next decade, according to the cost analysis.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
