The investment advisor fiduciary rule is back in the news. We have written about the rule before, but thought it would be helpful to revisit the topic since President Trump has issued an executive order that his Labor Secretary should review, and possibly overturn, the proposed regulations set to take effect in April.
Last year, the Department of Labor (DOL) announced new rules designed to protect investors who are saving for retirement by requiring brokers (Sage is not a broker), to help clients invest according to their clients’ utmost best interests, not merely in ways that are “suitable” to their interests. The regulations generated quite a few headlines as the large brokerage firms like Wells Fargo, Morgan Stanley, JP Morgan Chase, and Bank of America Merrill Lynch scrambled to find ways to operate according to principles that Sage has been following for more than 25 years. As an independent registered investment advisor (RIA), Sage will always, put our clients’ interests first.
- It is unclear whether Trump’s new Labor Secretary will prevent the fiduciary standard from taking effect in April or not. But regardless, Sage will always act as a fiduciary on our clients’ behalf. The investments and services that we recommend will continue to be those that we deem best for each individual investor based on that client’s specific goals and risk tolerance.
- Any change in how brokers are regulated will not change the relationship our clients have with Sage in any way. Sage operates as an independent registered investment adviser, and as such we are bound by our fiduciary duty.
- We consider independence to be one of our greatest strengths. Our clients know that Sage prioritizes their best interests, that we approach each client as a unique relationship, and that our investment advice is personal and objective.
- Unlike brokerages, which may be biased to recommend and sell investments and other products (i.e. insurance, mortgages) that generate more revenue for the firm, we do not receive commissions to buy and sell securities on your behalf, nor do we receive any compensation from any third party if we invest in their products. This enables us to recommend the investments that best fit each client’s financial profile, not just those that are merely suitable.
- We are hopeful that regulations will remain in place so that all investors will have better access to advice that serves their best interests. To us, putting clients first is simply common sense.
If at any time you would like to talk to us about our perspective on pending regulation changes or anything else, please reach out to us directly at 484-342-4400.
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