Last week I wrote about an Obama administration’s expansion of the Fiduciary Rule.
Gary Cohn, the chief economic advisor to President Donald Trump and Director of the United States National Economic Council wants to role back the Obama changes to the rule. He was formerly the president and chief operating officer of Goldman Sachs.
What a shocker that is!
The changes to the rule would expand the categories of those who work in the financial investment field that are governed by it.
Simply put, the rule states that those who are investing your money must do so in your best interest and must notify you if there is a conflict of interest.
It seems like the least they could do.
But not Trump and Cohn.
Said Cohn, “This is like putting only healthy food on the menu, because unhealthy food tastes good but you still shouldn’t eat it because you might die younger.”
Jon Bauman, former executive Director of the Illinois Teacher Retirement System, wrote me following the earlier post to clarify the role of TRS and our TRS trustees.
Jon’s clarification about TRS and their investment managers’ fiduciary responsibilities to TRS members is good news.
But for those who, because they are public employees, have much of their savings in 403(b) accounts, a rollback of the Obama protections is worrisome to say the least.
403(b) are accounts are where most public employees have their retirement savings and they already suck compared to the earnings of a 401(k). And Jon is right that the attempts to move our defined benefit system into a 401(k) defined contribution system would be a financial risk and disaster for Baby Boomers and other retirees.
I already hear that where ACA rules had capped insurance rates for old people at no more than three times what the insurance companies charge millennials, TrumpCare will permit insurers to charge old people 3.49 times their lowest rates.