Retirement Savers Are Getting Ripped Off
November 20, 2023 by The Editors of Bloomberg News
Where is the line between selling a financial product and providing investment advice? That question is at the heart of a debate over a new proposal that aims to protect Americans’ retirement savings.
Since 1975, the government has required pension fund advisers to meet a fiduciary standard, which means putting their customers’ needs first and limiting conflicts of interest. But the standard applies only to those who supply advice “on a regular basis.”
Click HERE to read the full story via Advisor Perspectives
Wink’s Moore on the Market: I still don’t understand how the U.S. Department of Labor contends that indexed annuities scalp “…$5 billion from retirees’ savings each year.”
Where did that value come from? What is it representative of? Indexed annuities generally don’t have fees, so I am confused.
I shake my head at “it also found that a previous fiduciary rule proposal in 2016 led insurers to offer more low-expense products while the sale of the highest-cost variable annuities fell 52%.”
Fee-based annuities may have experienced a spurt in development post-2016, but that doesn’t necessarily translate to sales.
Further, variable annuity sales have fallen as a result of the market’s performance; not the DOL’s proposed fiduciary rule.
Bloomberg News– the current regulatory regime for indexed annuities may be flawed, but I do not have confidence that the DOL’s proposed fiduciary rule improves the regulation of these products. -sjm
