DOL Fiduciary Rule Disclosures

A client-advisor relationship is one based on trust and candor. Each member acts as an active and integral part of the dynamic, and our advisors take their responsibilities seriously. For more than 50 years, Raymond James has championed clients’ rights to be informed, to understand their investments and the advice we provide. Now, in the midst of a new Department of Labor (DOL) rule governing retirement investment accounts, we want to make sure you understand what’s changing and – as importantly – what’s not.

Decoding DOL

As the DOL “fiduciary rule” begins to take effect, all financial advisors offering guidance on retirement accounts will be required to adhere to a new government-defined standard similar to the client-first approach to which Raymond James has long held itself. Formalizing this standard of advice means that when it comes to all-important retirement assets in 401(k) accounts, IRAs and other types of tax-advantaged retirement savings vehicles, investments must be selected based on the client’s best interest – our firm’s longstanding core value. It should be noted, though, that the rule does not apply to other accounts that may be informally earmarked as retirement savings, such as individual and joint investment accounts, bank accounts and money market mutual funds.

Fiduciary Standard Defined

The rule’s fiduciary standard formally requires that an advisor who acts as a fiduciary – in this case, a person who receives compensation for providing actionable advice to investors who participate in certain types of retirement plans – must act in the best interest of the client whose assets they are managing.

A History of Client-First Service

Client-first service has been Raymond James’ guiding principle since its inception in 1962. Our firm was one of the first in the industry to develop a Client Bill of Rights because we believe you deserve to truly understand the investment and financial planning process. We want you to have every opportunity to understand the risks, rewards and implications of various investment choices and financial planning strategies. The Client Bill of Rights is an important component of a strong working relationship with your advisor and ensures that you know your role, rights and responsibilities as an active participant in the planning process.

The fiduciary rule codifies for the entire investment industry much of what you already experience when you work with your advisor, who considers the suitability of a particular investment given your goals and the time you have to reach them, as well as your net worth, ability to tolerate risk and more. As the rule goes into effect, we remain focused on preserving flexibility in how you work with your advisor. Our objective is to continue thoughtfully serving your best interests and to comply with the rule without unnecessarily limiting your choices.

Among your rights as a client of a Raymond James advisor:

• You have the right to select and work with a trustworthy, independent financial advisor who is professionally competent, personally dedicated, and who communicates with you on a regular basis about your portfolio. You may request information about your advisor’s work history and background, and you may contact your state or provincial securities agency for verification.
• You have the right to expect financial and investment recommendations based solely upon your unique needs and goals, consistent with the objective of enhancing your financial well-being. While the performance of investments may not meet your expectations and markets can underperform their historical averages, recommendations should be based upon the goal of attaining superior performance in light of the facts known at the time of investment.
• You have the right to open, consistent communication and to have information presented in clear and understandable terms.

Staying the Course

Our advisors plan to continue our firm’s thoughtful, long-term approach to doing what’s best for you and your financial security, helping you select investments that we believe will give you the best chance of meeting your goals. We will continue to work closely with industry experts and regulators to comply with the rule as we plan for a seamless transition with little disruption to the relationships between advisors and valued clients like you.

Next Steps

Consider these to-dos as the rule is implemented:

• Ask your advisor about what to expect.
• Review our Client Bill of Rights, which is intended to help set the stage for a mutually beneficial relationship between you and your advisor.
• Sign up for Investor Access and e-delivery to help ensure you receive your communications in a timely manner.