Why Financial Professionals Will Matter Post-DOL

Why Financial Professionals Will Matter Post-DOL

While on a plane recently, I read a quick article in Money Observer, a British financial site. It was like I was getting a glimpse into the future of the post-DOL world here in the United States. With similar regulations taking effect in the United Kingdom in 2012, many clients can’t afford financial advice.  

Two facts in the article were staggering: 

  1. Half of the respondents who had an idea of how they were going to take their retirement savings thought that a drawdown strategy (systematic withdrawal strategies) would provide guaranteed income for life. Unfortunately, there are many variables that affect that strategy, including rates of return and withdrawal rates. But, I can confidently say that it will not guarantee income for life.  

  2. Twenty-five percent of respondents thought the drawdown strategy was risk free. Clearly, there’s a gap in the fundamental mechanics of receiving income from pensions. To a lesser extent, I found it interesting that 25 percent of respondents thought their pension income was tax-free. 


The complexities of the British pension system are no different than the complexities of U.S. retirement plans. Regardless, it’s clear that Americans will need advice. 

With some of the DOL ruling leaking out in various presentations over the last 30 days, I think it’s important not to lose sight of where commission-based products fit into the proposed rule (and, I stress that it’s still a proposed rule), which makes an attempt to focus on what is best for the client. We can’t let paperwork and regulation get in the way of what many of us have been doing for years – putting the client first and making sure there is a baseline of guaranteed income.  

Educating people and putting them in the right position to make quality decisions will never go out of favor. Because of that, I encourage financial professionals to think about how they will educate the large portion of retirement asset holders who will no longer have a wealth manager tied to the asset. Their clients will be looking for quality education, expertise and recommendations that will impact their lives for the next 30-plus years.  

Let’s collectively step up to the challenge of a post-DOL world and make a difference for our clients, their families, their co-workers and our industry. Don’t let the fear of change and how we transact business affect our view of who we do business with our or how our advice should be disseminated.  


Bottom Line

While we may need to be more transparent and change forms, we shouldn’t lose our core value proposition to our clients: quality advice and sensible solutions, delivered consistently through personal interaction.  


Learn More

Register for our webinar - Februrary 4, 2016 -  discussing the latest DOL rulings and changes to expect.


Mike McGlothlin is the Executive Vice President of Annuities at Ash Brokerage. His strength is helping advisors become more efficient and effective in their businesses. He and his team provide income-planning solutions focused on longevity and tax efficiency, and they also assist advisors with entering defined-benefit termination planning and structured settlement markets.