Subject: DOL Fiduciary Rule

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Dear NAME:

Newspapers, magazines and even late night comedians are discussing a new rule from the Department of Labor (DOL) and its effect on retirement accounts for millions of Americans. I want to take this opportunity to offer some explanation about the regulations and dispel any misconceptions.

DOL and The Rule

The DOL is charged with promoting the welfare of job seekers, wage earners and retirees in the United States. As part of this role, the DOL released a series of new policies designed to address how financial advisors can provide investment advice and products to both current and prospective clients with qualified retirement plans—such as a 401(k)—and IRA accounts. Many Americans utilize IRAs, 401(k)s, and other workplace retirement plans, as well as pensions, to fund retirement. These people often use a financial advisor to help them with investment decisions. The DOL Rule impacts financial advisors for all 401(k) plans and IRA accounts, including your accounts.

Changes You May Encounter

The rule requires all account advisors and representatives who provide services to IRAs to follow certain new standards. The rule establishes a best interest standard for clients when providing investment advice, requires reasonable compensation for services provided and requires advisors to adhere to the investment standards of a prudent expert based on the information at hand.

The rule is lengthy, with more than 1,000 pages of information, so it will take some time for the industry to fully assess the impact. What we know now is that there will be additional required paperwork and disclosure materials for specific investments. The DOL Rule will also limit what types of investments I can utilize within your retirement account. My broker-dealer, National Planning Corporation, is currently evaluating the rule and will help me determine what new paperwork will be required and provide guidance on product restrictions. The rule allows for a transitioned implementation with a majority of the rule becoming effective April 10, 2017.

As we continue to develop our response to the DOL ruling, I’m committed and prepared to provide you with additional information on the impact to our relationship. If you have any questions about this topic, please feel free to reach out.

Sincerely,

[ADVISOR]