Close Close

Regulation and Compliance > Federal Regulation > DOL

What's Keeping Advisors Up at Night?

Your article was successfully shared with the contacts you provided.

For most advisors, the push to comply with the Department of Labor’s new fiduciary rule continues.

In a recent survey, Fidelity found that the vast majority, 63%, were moving ahead as planned (44%) or slowing down their compliance efforts only slightly (19%).

Less than a quarter, or 23%, say they are moving somewhat slower to conform to the new fiduciary standard, with just 14% indicating that they have decided to proceed at a much slower pace. Only 1% of advisors polled by Fidelity around Jan. 18 state that they have halted their DOL compliance efforts.

“Advisors continued to focus on implementation and have firmly shifted their focus from the ‘what’ to the ‘how,’” said Scott E. Couto, president, Fidelity Institutional Asset Management, in a statement.

“While they have invested time, energy and resources to understanding the rule and its implications, they have now directed their attention to what it means for their practices, including how to implement the necessary changes, regardless of any potential regulatory developments,” Cuoto explained.

In a separate survey, 32% of advisors said their top concerns in the fourth quarter were those tied to government and economic issues.

This is up from 28% in Q3, 21% in Q2 and 16% in Q1.

Other Issues

More than one-fourth, or 26%, of advisors surveyed in Q4 said that portfolio management was their top concern, up from 25% in Q3.

Other issues on their minds were bonds and fixed income (11% vs. 14% in Q3), interest rates (11% vs. 13% in Q3) and market volatility (11% vs. 18% in Q3).

Given the level of regulatory uncertainty, advisors are advised to do the following:

  • Discuss the regulatory changes and their implications with clients.
  • Have a disciplined investment and recommendation process.
  • Optimize productivity to free up time to provide goals-based planning.
  • Use the DOL opportunity to get to know clients better.

Even with further developments effecting the DOL fiduciary rule, the reality “is that the rule is only accelerating – not causing – some of the fundamental trends that had already been taking hold across the retirement industry: the shift toward greater transparency, fee-based compensation, lower-cost products and digital advice solutions,” added Couto.

“These will likely remain with or without the DOL rule being applicable, in part due to changing consumer preferences and new technologies. Regardless of the DOL rule, advisors may find that proactively taking action now will better prepare them for the future,” he explained.


© 2023 ALM Global, LLC, All Rights Reserved. Request academic re-use from All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.