Government to rescue

[Allen Trent]

Uncle Joe & Government to the rescue for 3rd or 4th time in a decade. You guys with junk fees better brush up your resumes.

Suitability not enough
Best interest not enough
DOL 1.0 not enough
DOL 2.0 not enough

Finally, the government is here to fix it & get rid of those products that might have a 1 time 3-5% commission so the client will be better with 1% fees annually for 20-30 years. Winning with math.

[EXTERNAL LINK] - Retirement savings boost? Biden says new fiduciary rule can do that

 

[DHK]

I believe this is the first time that the NAIC and ACLI have both spoken out against this:
https://content.naic.org/article/st...who-buy-annuities-naic-releases-statement-dol

https://impact.acli.com/frightful-time-for-harmful-proposal/

 

[DHK]

NAIFA is offering a member-only DOL debrief next week:

[EXTERNAL LINK] - NAIFA Offers Members-Only Debrief on the DOL Fiduciary Proposal

 

[InsuranceGuy29]

The liberal government regime's entire modus operandi is (and has always been), "We are totally good and we're here to rescue you from everyone else that's totally bad!" They always need to create the boogeyman to justify their place as the "hero," so that you trust them more as they jam the big red, white, and blue thick/elongated toy up your rear end. If there isn't a problem, they will SURELY create one and then gaslight everyone into thinking it's always been a problem. If he REALLY wants to protect everyone's retirement savings, maybe he should work on getting this absolutely INSANE inflation down. Nah, can't do that though.....then everyone won't be dependent on government.

 

[AmyDurso]

Thanks for the link, I didn't know it before.

 

[scagnt83]

This mainly impacts those working in a hybrid RIA environment..... and imo, most hybrid setups are not acting as a true Fiduciary.

Annuities are not going anywhere. How you get paid on annuities might change.

And if the wrap fee does indeed make the advisor more money.... why are advisors crying about it?

I know advisors at Captive BDs/RIAs are crying because the RIA is 2 decades behind the industry.

Its about transparency and making it simple for investors to know WHY an advisor is recommending a product.

 

[Allen Trent]

This mainly impacts those working in a hybrid RIA environment..... and imo, most hybrid setups are not acting as a true Fiduciary.

Annuities are not going anywhere. How you get paid on annuities might change.

And if the wrap fee does indeed make the advisor more money.... why are advisors crying about it?

I know advisors at Captive BDs/RIAs are crying because the RIA is 2 decades behind the industry.

Its about transparency and making it simple for investors to know WHY an advisor is recommending a product.

So, do you think Best Interest & Suitability forms are not enough in the 40 states? I just look at the billions in MYGA sales with CD type sales. Just not sure those fall into a category of abusive junk fees. I personally consider some of the AUM fees more junk when the money is just going into index funds & sitting for decades

Will be interesting to see how it plays out. Funny part is no one in the entire industry helps people save money any more. It has become solely lump sum sales of existing assets or rollovers.

Unless someone saves at work or online, there is little chance for people to get started saving as the products dont exist at low contribution amounts from reps or no compensation for rep to cover the time & cost to have someone save $100-$300 a month

 

[scagnt83]

So, do you think Best Interest & Suitability forms are not enough in the 40 states? I just look at the billions in MYGA sales with CD type sales. Just not sure those fall into a category of abusive junk fees. I personally consider some of the AUM fees more junk when the money is just going into index funds & sitting for decades

Will be interesting to see how it plays out. Funny part is no one in the entire industry helps people save money any more. It has become solely lump sum sales of existing assets or rollovers.

Unless someone saves ar work or online, there is little chance for people to get started saving as the products are dont exist or no compensation for rep to cover the time & cost to have someone save $100-$300 a month

I think the various situations and products vary so much, it is hard to make blanket statements.

For the annuity world, DOL 1.0 had way more of an impact on the structure and comp of annuity products than BICE. imo

Best Interest is an exemption. I think its a feckless piece of legislation that did very little to help consumers.

For an Advisor charging a planning fee and marketing themselves as a Fiduciary, in my opinion, product comp differences should be taken off the table. That means standardized comp or transparent fee based comp. Or outsource to a strategic partner.... which has its own rabbit hole of conflicting interest possibilities.

Im not saying all advisors who operate in a hybrid advisory model are bad.
But if we want to be real about consumer protections.... and adhearing to what a true Fiduciary is and does... at minimum comp should be very transparent and disclosed right along side all the other pros/cons, in a way it is not in today's world.

Transparency builds trust. Our industry needs all the trust building we can muster.

Most Advisors who bill a fee are not acting as a true Fiduciary in the classic technical meaning of the word... therefore not providing the true benefit of a Fiduciary.

 

[scagnt83]

Unless someone saves ar work or online, there is little chance for people to get started saving as the products are dont exist or no compensation for rep to cover the time & cost to have someone save $100-$300 a month

I get what you are saying. But I disagree with the premise of it.

I dont feel that new savers necessarily need face to face advise to put $500 a month into an IRA.

An online risk tolerance questionnaire, along with model portfolios using index ETFs, is really all a new saver needs. And an extremely strong argument could be made these days about that model fitting even those with moderate savings accumulated.... the same modeling software advisors use in the background can now be applied on a wide scale direct to consumer.

What most people actually need is the push and convincing to actually save that $500 a month.
Which is a cultural shift just as much as it is an industry shift.

Annuity carriers didnt stop selling Flex Premium Annuities because demand was high.... they stopped selling them because demand was slim to none. Its the culture and public just as much as it is the industry.

 

[Markthebroker]