Advice about 401(k) rollovers is poised for a big change. Here’s why [Video]

A new U.S. Labor Department rule will significantly change the advice many investors receive about rolling money over from 401(k) plans to individual retirement accounts, legal experts say.

The so-called “fiduciary” rule, issued April 23, aims to raise the legal bar for brokers, financial advisors, insurance agents and others who give retirement investment advice.

Such recommendations may be tainted by conflicts of interest under the current rules, the agency says.

Rollovers are undoubtedly a “chief focus” of the regulation, said Katrina Berishaj, an attorney at Stradley Ronon Stevens & Young.

“The Department of Labor was not shy about that,” said Berishaj, co-chair of the firm’s fiduciary governance group.

Rollovers are common, especially for retiring investors.

They often involve moving one’s nest egg from a 401(k)-type plan to an IRA.

In 2022, Americans rolled over about $779 billion from workplace retirement plans to IRAs, according to a Council of Economic Advisers …