If you're like many RIAs, you take pride in the fact that you always act in the best interests of your clients. You don't sell high-commission products like nontraded REITs or equity index annuities. So you might be assuming that the Department of Labor's fiduciary rule, which began its phased implementation on June 9, doesn't apply to you.
You're wrong.
Under the new rule, always serving each client's best interests isn't enough. You must also document the fact that you are doing so. I'll leave it to compliance and legal experts to explain what you must do, how you must do it and when; my point here is to get you to understand that the new rule has important implications for you.
I mention this because I attend a lot of industry events, and I keep running into advisors who adamantly insist that the new rule doesn't apply to them. I don't sell commission-based products, they tell me. I charge by the hour, some say. None of that matters. The fact is that the new rule creates important obligations for advisors from an operational and procedural perspective.