Kenneth Corbin

The industry groups working to scuttle the Department of Labor's fiduciary proposal hit a setback this week on Capitol Hill, but are vowing to continue to fight.

Seeking an alternative to the DOL's controversial proposed fiduciary rule, some members of Congress are drafting their own proposal that would establish rules for advisers working with savers and plans without the regulatory burdens and litigation risks that critics see in the DOL's plan.

Warnings of billions in crippling costs and TV attack ads are the latest salvos from opponents of the Labor Department's fiduciary rule after hearings closed last week. The industry's newest claim is that independent firms could get hit with a bill tallying up to $3.9 billion in startup costs alone should the rule go into effect.

Of the many industry critiques of the Department of Labor's fiduciary proposal, one of the most oft-repeated is the assertion that new regulations would cut off access to advice for low- and middle income investors — precisely the segment of consumers the initiative aims to protect.

Concerns about over-regulation and accusations of industry cynicism led the opening of the Labor Department's hearings on its proposal to impose fiduciary requirements on retirement advisers — the latest phase of its contentious process to craft new rules on consumer protections.

If the DOL's proposal to impose new fiduciary responsibilities on advisers in the retirement space becomes rule, many financial professionals fearing legal liability could abandon that market altogether, and cut off services to low- and middle-income investors, according to FINRA chief Richard Ketchum.

As a younger generation of investors begins to grapple with retirement planning, advisors and fund companies should take note of the distinct concerns that those millennials bring with them