Financial Advisor

Tim Hayes

Offices in Boston & S Dartmouth

I am an Investment Adviser Representative at Cambridge Investment Research Advisors, Inc., a $44B RIA based in Fairfield, IA. I am also registered with Cambridge Investment Research, Inc., an independent broker-dealer with over 3,000 registered representatives nationwide.

Most clients pay fee-only or an hourly rate. The size and complexity of the client’s wealth management and financial and retirement planning determine that fee.

Some clients pay a commission, mainly those with smaller accounts, i.e., Roth IRAs, some public-school teachers with 403b retirement accounts, or parents or grandparents who set up a 529 college savings plan.

The first introductory and fact-finding appointment can be in-person or by phone. The next meeting where I provide my recommendations should be in-person. (For the time being, telephone, Zoom, and email are replacing some in-person meetings.)

Subsequent meetings during which we monitor your progress and investments can be done in-person or by phone, email, Zoom, or Skype – or, more likely, a combination of these meeting types.

Contact Tim

New Rules for Retirement Plan Fiduciaries

With three major rule changes, the Department of Labor followed through on its promise to change the retirement plan landscape.

Covered service providers (CSP) must fully describe their services and fees. This rule requires covered service providers (financial advisors, financial consultants, or third-party administrators who expect to receive $1,000 or more in direct or indirect compensation for their services) to detail their compensation and fee structure.

CSPs also include financial advisors or TPAs who act as fiduciaries or registered investment advisers for plan sponsors. If applicable, the CSP must detail any fees charged for record-keeping along with record-keeping methods.

Fiduciaries must describe the fees to plan participants. If participant-level fee disclosures are not provided to plan participants after May 31, 2021, then a plan participant or beneficiary may claim a violation of fiduciary duty on the part of the plan sponsor.

For calendar year plans initial quarterly disclosures must be furnished by August 14, 2012. In addition, the new regulations require fiduciaries to disclose and update:

Rules related to the dissemination of investment intructions to the plan

Plan fees and expenses paid from the participant accounts (plus a breakdown of these fees, i.e., investments management fees, admin fees, cost-of-advice fees)

Any other specific fees or charges that may be drawn from a plan participant’s account.

The final rule change was the controversial Fiduciary Rule, where the DOL expanded the definition of an ERISA fiduciary. Under the new rule, anyone who advises a retirement plan is considered to be one.

The goal? The DOL wants to make these plans more transparent. This is an occasion for plan advisors to reconnect with plan sponsors, financial advisors, fiduciaries, and participants. Moreover, have a financial consultant audit your plan. They can check if your 401k, SIMPLE, SEP, or ERISA 403b is following both the spirit and the letter of the new rules.

These are the opinions of Financial Advisor Tim Hayes and not necessarily those of Cambridge Investment Research. They are for informational purposes only, and should not be construed or acted upon as individualized investment advice. 

Sources:

advisorone.com/2011/07/14/3bsa-extends-408b2-compliance-deadline-to-april-20[7/14/11]

prudential.com/media/managed/PruPA-DOLServiceProviderFeeDisclosure.pdf[9/10]

webapps.dol.gov/FederalRegister/PdfDisplay.aspx?Docld=25179[7/19/11]

buckconsultants.com/buckconsultants/portals/0/documents/PUBLICATIONS/Newsletters/FYI/2011/FYI-07-25-11-DOL-Extends-Compliance-Dates.pdf[7/25/11]

accountingtoday.com/news/Congressional-Democrats-Want-Agencies-Revise_Fiduciary-Rule-58352-1.html[5/11/16]

opinionline.comarticle/20110725/PRINTSUB/307259971[7/25/11

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