Beginning early Wednesday morning, my email and voicemail started blowing up with questions about what advisors should expect from President-elect Trump regarding the DOL Rule. Like me, you’re probably seeing headlines coming out every hour or so with speculation about what is going to happen. So what do we think advisors should do? What you already should be doing – preparing.
Speculation is just that… speculation
The short answer on what happens next with the DOL is: Who the heck knows? As President, Trump himself cannot just wave a magic wand and make the Rule go away. Once in office, he would first need to appoint a new Labor Secretary, who could then start a process to rescind the rule, amend it, or take some other action.
We have no idea if that is in the works, or how long that would take, but presumably, it would take some time. There is also talk of legislative action, including support for a bill in Congress that would put the DOL Rule on hold, pending SEC action. Still others are talking about adding riders to spending bills that would not permit the DOL to use funds for rule implementation.
But, this is all speculation at this point. Hoping or speculating on an outcome is not a basis on which to build an advisory business. As of today, it is still a law and that law takes effect on 4/10/2017.
I think most firms will (and should) continue on as they have been planning. I also think the firms that have announced larger changes won’t go back, regardless of what happens. Personally, I would doubt that in Trump’s first 60 or so days in office, he would focus on how financial advisors get paid. He has a few other, more pressing matters that he will use his political capital for and frankly, I don’t think it is very high on his priority list.
I’ve written about this possibility before in Advisors: What’s Your DOL Excuse? and my answer is the same. Advisors should continue down one path – own the DOL rule as it stands today. Don’t hope/speculate/procrastinate. Own it.