"Proposed Labor Department Rules Aim to Enhance Investor Protections for $600 Billion in IRA Investments"

The U.S. Department of Labor is expected to introduce new rules aimed at increasing protections for investors who roll over more than $600 billion a year to Individual Retirement Accounts (IRAs). Currently, IRAs hold about $11.5 trillion, almost double the amount in 401(k) plans. While rollovers offer advantages, such as flexibility, they often come with higher fees and may not be subject to a fiduciary standard of care. The proposed Labor Department rule, which is currently under review, seeks to raise the bar on rollover advice provided by financial advisors and close loopholes, potentially subjecting all rollovers to the highest level of investor protections. This could include requiring advisors to act solely in investors' best interests and allowing investors to sue for bad rollover advice. The rule is expected to take at least two years to take effect.