Come June 30, 2020, broker-dealers will be required to comply with the Security and Exchange Commission's Regulation Best Interest when recommending retail investors roll over 401(k) assets to IRAs.
Under Reg BI's Care Obligation, brokers will have to have a "reasonable basis to believe that the IRA or IRA rollover is in the best interest of the retail customer at the time of the recommendation and does not place the financial or other interest of the broker-dealer ahead of the interest of the retail customer," according to language in the final rule.
Will the best interest requirement stem the flow of 401(k) assets into IRAs, which held $8.8 trillion in assets at the end of 2018?
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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.
