Don't stop fighting for Retirement Security Rule, financial planning coalition urges DOL

A coalition of national financial planning organizations is urging the Department of Labor to stay the course on a proposed fiduciary rule aimed at protecting retirement investors.

In a joint open letter to Labor Secretary Lori Chavez-DeRemer dated May 22, leaders of the CFP Board, Financial Planning Association, National Association of Personal Financial Advisors and XY Planning Network reaffirmed their support for the Retirement Security Rule.

The proposed regulation would require financial professionals to provide advice on retirement assets in clients’ best interests – extending protections not fully covered under existing frameworks like the Securities and Exchange Commission’s Regulation Best Interest.

“The Retirement Security Rule addresses important regulatory gaps and helps protect Americans from the costly effects of conflicts of interest,” the letter said. “Importantly, the DOL rule aligns with investor expectations for retirement investment advice.”

Citing survey results from CFP Board research conducted in 2024, the organizations emphasized that a vast majority of Americans already assume – very often, incorrectly – that financial professionals are providing fiduciary-level advice when it comes to retirement savings.

The letter noted that 92 percent of Americans believe their financial professional should act in their best interest, and 97 percent agree that this standard should apply even to one-time advice.

The groups also pushed back against critics' claims that stricter regulatory standards would limit access to advice for middle-income clients.

According to the CFP Board, no measurable reduction in access followed the implementation of Reg BI or its own fiduciary standards. They pointed to XY Planning Network as an example, citing its annual 29 percent growth rate serving Gen X and Gen Y clients under a fiduciary model with no asset minimums.

“Retirement investors will not lose access to advice because of the DOL rule,” the letter maintained. “Tens of billions of dollars are being taken from the American public by sales pitches or financial advice that are in the best interest of financial professionals, not investors.”

The letter also highlighted that many regulators have already acknowledged the need for a higher duty of care by enacting best interest or fiduciary standards. As a recent case in point, the North American Securities Administrators Association updated its Conduct Rule in April, restricting individuals from using an "advisor" or "adviser" title unless they have the required certification.

However, gaps remain for certain assets like some insurance products, which the proposed DOL rule is intended to cover. 

The coalition expressed appreciation for the department’s work modernizing what they described as an “outdated, 50-year-old rule,” calling the update “important and necessary” for today’s retirement landscape.

The letter closed with a call for the Department of Labor to continue defending the rule, with is now sitting in the Fifth Circuit Court of Appeals following a lengthy saga of legal challenges.

“Workers and retirees deserve a financially secure and dignified retirement,” the letter said. “The DOL rule will provide investors with faith that their financial professional is delivering retirement investment advice in their best interest so that they can achieve their investment and retirement goals confidently and ethically.”