Protecting and Promoting Retirement Savings

Americans should be able to retire with dignity after a lifetime of hard work. That’s why the Labor Department has focused on strengthening consumer protections and expanding savings opportunities for America’s workers and their families.

Preventing conflicts of interest

Financial advisers giving sound advice deserve to be well paid for the important work they do, helping workers build their nest eggs so they can retire after years of hard work.

However, an adviser may have a conflict of interest if he or she gets paid more for steering clients into one investment product instead of another. Clients are sometimes unaware of these payments because they can be hidden in fine print or not disclosed at all.

A White House Council of Economic Advisers analysis found that conflicted advice by financial advisers results in annual losses of about $17 billion a year for investors.

Our 2016 conflict of interest rule will help ensure that if you pay someone for retirement advice, they are legally obligated to look out for you. The rule clarifies the scope of the definition of a “fiduciary” so that it clearly incorporates brokers and others giving investment advice to employees in 401(k) plans, IRA owners, other retirement savers and certain plan sponsors.

This rule will help American workers keep more of their hard-earned savings, rather than putting it in the pockets of unscrupulous advisers through hidden fees and conflicted advice.

Increasing access to retirement saving opportunities

One-third of America’s workers do not have access to a retirement savings plan through their employers. At the 2015 White House Conference on Aging, the president directed the department to support the growing number of states trying to promote broader access to workplace retirement saving opportunities for America’s middle-class workers.

In November 2015, we proposed a regulation to provide a new safe harbor for state-sponsored IRAs that conform to certain provisions. This rule would allow for automatic enrollment of employees in such programs so long as they are given the ability to opt-out, and employers are minimally involved.

For example, employers would make the automatic deductions from employee paychecks, but the employees and states would retain control of the program and IRA accounts. At the same time, we also published guidance for states seeking to create 401(k) programs that comply with ERISA for workers who do not have access to retirement plans through their employers.

Investments that do good

We also released new guidance last fall clarifying that an ERISA pension plan can invest in projects or companies that serve the common good, while keeping at the forefront the fiduciary obligation to invest prudently and for the exclusive benefit of retirees and workers.

Our actions will help secure a dignified retirement for more middle-class families, and they’ll level the playing field so that retirement advisers will compete based on the quality of advice they give.

For questions about retirement or health benefits, contact our Employee Benefits Security Administration toll-free at 866–444–3272 or online.

This post is part of our “Working for You” series, highlighting how the Department of Labor, and the efforts of the Obama administration, are helping hardworking Americans succeed. View them all at