You’ve worked hard to build up your retirement savings, and you might work with a trusted investment advice professional to help you invest it. The new Retirement Security Rule from the Employee Benefits Security Administration makes sure that the investment advice you get is in your best interest.
Who does this rule apply to?
Persons and financial institutions who give you professional advice on how to invest your retirement savings.
When does this take effect?
These new protections will start to take effect on September 23, 2024, though additional requirements will kick in 1 year after that.
Does this rule cover my retirement plan?
The rule covers investment advice on many kinds of job-based plans, including traditional pension plans, 401(k)s, and IRAs.
What does this rule do?
Requires these trusted advice providers to act as fiduciaries, which means they must work in your best interests.
Why did EBSA issue this rule?
To update a 1975 regulation and protect you from harmful conflicts of interest in today’s marketplace.
How can I be sure the rule protects my advice?
Ask your investment advice provider if they are an ERISA fiduciary—and get it in writing.
Common questions
Does my investment advice provider have to follow this rule?
If your investment professional holds themselves out as someone who will provide you with advice based on your individual circumstances and in your best interest, and you pay them for that advice or they otherwise get compensated for giving you that advice, they are a fiduciary. That means they generally must follow this rule’s requirements to provide you prudent, loyal, and honest advice.
This includes advice on recommendations to purchase, sell, or hold investments in your retirement account, as well as advice on rolling over assets from your workplace retirement plan to an IRA.
Investor tip: When you are getting investment recommendations, ask if the person making the recommendation is acting as an ERISA fiduciary. And even if they say yes, ask for that representation in writing.
My advice provider is a fiduciary. What do they have to do?
Generally, they have to make sure that the investment advice they give you is prudent (it meets a professional standard of care), loyal (it puts your interests first), honest (it is free from misrepresentations), and free from overcharges (unreasonable or excessive compensation).
This means they must provide advice that carefully considers your personal goals and circumstances. They have to recommend what’s best for you, not what would make them the most money.
In late 2025, more specific requirements will kick in. Your advice provider will have to give you more disclosures and follow policies and procedures designed to make sure the advice really is in your best interest.
Why is it important to get the ERISA fiduciary statement in writing?
It is important that both you and your advice provider understand the nature of your relationship. You’ll have documentation that your advice provider promised to act in your best interests.
What should I do if I think my advice provider isn’t following this rule?
Contact us at 1-866-444-3272 or dol.gov/AskEBSA.
Learn more about the Retirement Security Rule.