An funding advisor who’s skeptical about annuities predicts that the Labor Division’s rollover charge disclosure proposal will damage annuity gross sales.
John Nowicki, president of LCM Capital Administration, a Chicago-based registered funding advisor, welcomed DOL efforts to have monetary professionals create complete rollover assessments when serving to shoppers who’re considering of shifting property out of 401(ok) plans or particular person retirement accounts.
“I’ve been on this enterprise for 36 years,” Nowicki stated. “I’ve by no means offered an annuity to a shopper, though I’m licensed to. The explanation: I couldn’t discover somebody silly sufficient to say, ‘Hey, John, it is a nice funding’ after I clarify all the charges, give up expenses, tax implications and nuances of an annuity.”
What it means: Some advisors have warmed as much as annuities, however others proceed to be unimpressed. These advisors might be a part of the annuity gross sales requirements dialog.
The background: The DOL’s fiduciary rule replace proposal would set new disclosure necessities for retirement professionals serving to shoppers with 401(ok) plan asset rollovers.
If a life insurance coverage agent needed to advocate an annuity, the agent must present the annuity alongside options, together with the choice of leaving the property within the 401(ok) plan.
The comparability must give the prices related to every choice.
Advisor’s perspective: At LCM Capital, Nowicki has targeted on reducing shoppers’ charges and taxes.