In a comment submitted to the Department of Labor, EPI Policy Director Heidi Shierholz estimates that the Trump administration’s proposed 18 month delay of key provisions of the fiduciary rule—which requires financial advisers to act in the best interest of their clients—will cost retirement savers $10.9 billion over 30 years. Shierholz strongly opposed any further delay the rule, and urges DOL to allow the rule to go fully into effect as scheduled.
“Delaying this common sense rule will cost working people who are saving for retirement billions of dollars—dollars that will end up in the pockets of unscrupulous financial advisers,” said Shierholz. “Anyone who wants the American people to get a fair return on their hard work should oppose this delay.”
The $10.9 billion estimate assumes that, absent the full implementation of key enforcement provisions, there will be a 50 percent rate of compliance with the rule. Shierholz’s comments provide a range from $5.5 billion to $16.3 billion, representing compliance rates of 75 percent and 25 percent, respectively.
“They are calling this a delay, but it’s a transparent attempt to weaken or kill the rule,” said Shierholz. “The financial services industry, who has been lobbying heavily for this delay, are the only ones who stand to benefit.”
Retirement savers in every state will lose money if there is a delay in the full implementation of the fiduciary rule. Losses from the additional delay, which will persist and compound long after the delay ends, range from $804.9 million in California to $10.4 million in Wyoming.