The new Department of Labor (DOL) fiduciary rule came into effect on June 9, 2017. This rule requires that brokers must put their clients’ interests first when offering advice regarding retirement savings accounts. This new rule won’t be enforced until after January 1, 2018, when requirements regarding disclosures and new contracts are currently expected to take effect, unless amendments are made before that time.

What You Should Know the DOL Fiduciary Rule

This new rule gives financial advisors the opportunity to better educate their clients by explaining the value and risks associated with each advised course of action. The rule applies whether advisors work on a commission or fee basis. This will be a game-changer for both advisors and clients alike. Advisors who might not have fully had the best interests of their clients in the past will be held accountable. Those who directed clients toward riskier investments due to the lure of a high commission will be prohibited from doing so.

With this new rule, advisors will be required to explain their reasoning for recommending specific investments or financial planning strategies. Most importantly, they must be transparent about their own financial gain as a result of their recommendations. For clients, this affords protection from opportunistic advisors. For advisors who have been conducting ethical business all along, this levels the playing field.

Read more about the DOL Fiduciary Rule and its implications on your financial planning in this Forbes article.