Washington, D.C. Counsel Brad Campbell was quoted in a MarketWatch article titled, “To roll or not: That will be the question come April 2017.” The article discusses the upcoming DOL’s conflict-of-interest rule, which goes into effect April 10, 2017. The new rule will require many to create a detailed checklist, including signing a best interest contract which agrees that your adviser is acting in your best interest. In deciding what should be on the 401(k)-to-IRA and/or IRA-to-IRA checklist, Brad notes that an evaluation of all options is necessary.
“Ultimately, this is an individualized decision that requires an evaluation of all of your options, including staying in your 401(k) plan, based on your anticipated retirement needs,” Brad said. “401(k) plan participants should ask a number of questions when considering a rollover.”
Brad also encourages asking about restrictions on liquidity or penalties for changing your mind, as well as taking more than cost into consideration.
“Obviously, cost matters, but it is not the only relevant factor to consider,” Brad said. “While it may be cheaper to stay in your 401(k) plan, you may require and find real value in the additional services an IRA might offer that your plan does not.”
Brad notes that after the rule goes into effect, your adviser should be able to provide you with a written explanation of why the rollover recommendation is in your best interest, and should identify the relevant factors the adviser considered and explain why the rollover was prudent.