To embrace or oppose fiduciary rule? That is the question.

Some industry groups may go to court, hoping to overturn the Department of Labor’s new fiduciary rule, scheduled to go into effect April 10.

But as growing numbers of advisers accept that the rule is coming, at least some in the industry are suggesting that embracing the rule now is a smart growth strategy.

“We’re on the eve of the greatest disruption this industry has faced since the Great Recession,” says Ron Carson, a CFP and the founder and chief executive of The Carson Group, a wealth management firm in Omaha, Nebraska, with $8 billion in assets under management. “If you’re an adviser, you need to decide whether you are going to be a disrupter or one of the disrupted.”

Clients are becoming “smarter by the day” about the differences in how advisers work, Carson says.

“Many still don’t understand about embedded conflicts of interest, but they are getting the difference between a planner and a broker. They want transparency and an adviser who’s a fiduciary,” Carson says.

“They’re going to look at their adviser, and if they’re not getting those things they’re going to move to another adviser who offers them,” he says.

“What’s also changing is that the young people who will be getting all their parents’ wealth already get the difference. They want an adviser who is working for them,” Carson says.

Rick Rummage, president of The Rummage Group in Herndon, Virginia, won’t go that far.

He says that most clients “still have no idea” what the whole fiduciary rule issue is about and warns that “saying to all clients that you are adopting all requirements of the rule now is a double-edged sword.”

Advisers must be preparing for the arrival of the new fiduciary rule next spring, and they “should be able to have an intelligent discussion with those clients who ask about why they are shifting to a fee-based, financial planning model and how they are absolutely prepared to meet the new DoL fiduciary rule’s requirements,” Rummage says.

“On the other hand, if you talk about this with every client, you’re going to be spending a lot of time explaining something that you might not have had to explain,” he says.

Carson disagrees.

“Just waiting to be asked is living in the past,” he says. “Show potential clients how you are getting paid, that you are transparent and that you embrace the DoL’s fiduciary standard, and they will flock to you.”

This story is part of a 30-30 series on smart strategies for RIAs

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