AARP: Don't mess with rule that protects retirees

Retirement should be a time of peace and relaxation, not one of struggle and financial worry. And when retirees seek advice regarding retirement investments, they should expect their professional advisors to give prudent guidance that keeps their best interests in mind.

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But low- and middle-income Texans currently lack adequate protections with their retirement savings. The previous administration updated and strengthened a Department of Labor fiduciary rule to require financial advisors to act in clients’ best interest rather than their own. A recent executive order has put those protections into doubt.

“We deserve financial advisors who work just as hard to protect what we’ve earned,” said AARP Texas Director Bob Jackson.  He said many advisors, without the protections, have no legal obligation to act in their clients’ best interests by ensuring their hard-earned retirement savings are securely invested. As a result, Jackson said, investors may lead retirees to put their nest eggs into funds with high fees and undisclosed commissions.

According to a 2015 estimate by the White House Council of Economic Advisers, Americans stand to lose up to $17 billion a year if the rule is reversed.

In a recent commentary that appeared in the San Antonio Express-News, Cristina Martin Firvida, AARP’s director of financial security, said that restoring the protections for retirees is “a top priority for AARP.”

Meanwhile, the Express-News has called on President Trump’s administration to put the rule back in place.  “It’s common sense,” the editorial reads. “Financial advisers should work on behalf of what’s best for their clients, not high-fee funds that reward with commission.”

-- By Liz Steele and Mark Hollis