Trump Can’t Stop the Retirement Revolution

The fiduciary rule is now in doubt, but investors will never be so dumb again.

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By Ben Steverman

February 9, 2017 at 6:57 PM UTC

This article is for subscribers only.

This article is part of the February 13, 2017 issue of businessweek.

Over the past decade, the way that millions of Americans invest for retirement has changed. Money has fled from many high-priced investment products. Companies that built their businesses on armies of commission-based salespeople are scrambling for cheaper ways to deliver advice. A 500-word memo signed on Feb. 3 by President Trump may slow this trend, but it’s unlikely to reverse it.

Trump ordered the U.S. Department of Labor to reconsider the fiduciary rule, a regulation set to go into effect in April. It requires financial advisers to put their clients’ interests first when handling retirement accounts. The U.S. retirement market is about $25 trillion in assets, the Investment Company Institute says, so the rule goes right to the heart of the advice business. Many on Wall Street hate it.