Getting Financial Advisers to Care (More) About You

Email a Friend
Financial advisers don't always have to act in the best interest of their clients. The President wants to change that.

President Obama is proposing changes to how financial advisers provide retirement advice.

“The challenge we’ve got is right now there are no uniform rules of the road that require retirement advisers to act in the best interest of their clients,” Obama said, speaking before the AARP in February.

As it stands, advisers can suggest retirement plans that include high fees and provide low returns without facing significant consequences. To change that, the Labor Department in April proposed a new set of standards known as a "fiduciary rule."

During hearings this week about the proposed rule, representatives from the financial industry said it's impractical and burdensome, and would increase the cost of marketing, which would make it impossible to reach people living in remote areas of the country or clients with relatively small portfolios. Others said the rule patronizes consumers who should be able to make financial decisions for themselves. Some groups have proposed amendments to the rule which they say will help those who have less money to invest.

Money Talking host Charlie Herman interviews guests Jason Zweig, investing and personal-finance columnist for the Wall Street Journal, and Helaine Olen, "The Bills" columnist for Slate and author of Pound Foolish, about what the rule would accomplish and what it says about the current state of the financial advice industry.