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401(k) dilemma: Advisers weather a fog of uncertainty surrounding IRA rollovers

The DOL rule is dead, but advisers giving advice on moving 401(k) funds to individual retirement accounts are nervous because they’re trying to meet regulators’ expectations and possible changes under a new SEC advice rule

By Mark Schoeff Jr. | Investment News | Dec 1, 2018

It’s perhaps the most important inflection point of a client’s financial life and one of the most lucrative for an investment adviser or broker — and with millions of baby boomers heading into their golden years of retirement, IRA rollovers are happening frequently.

Yet the moment is fraught with danger for advisers and investors today because of a lack of clear regulatory directives on what advisers should suggest clients do with that old company 401(k).

Advisers certainly aren’t avoiding rollovers. There’s too much money at stake. But at the forefront of their thoughts — or at the very least in the back of their minds — is a nagging question: How can I provide rollover guidance and manage to stay compliant in the midst of a regulatory void?

“Sometimes when a rollover from a 401(k) to an IRA is in the client’s best interest we have a difficult time being able to illustrate that in writing if we cannot obtain the information from the 401(k) provider,” Mr. Huszczo said. “We have to have a standardized way to go about it from a compliance standpoint.”