The Department of Labor today released the final fiduciary rule, imposing new regulations that will restrict investment advice for IRA and 401(k) users. Ultimately, this rule will allow bureaucrats to decide what appropriate financial advice should look like. Inevitably, this will increase the costs associated with using retirement savings accounts and disproportionately impact low and middle income families.

Under the rule IRA and 401(k) investment advisors will now have to satisfy punitive, unnecessary federal regulations to prove they are acting in the “best interest” of their client. According to economists Robert Litan and Hal Singer these standards appear to be “a vague open- ended obligation with seemingly no bounds.”

The rule will likely have a number of consequences including limiting the ability of IRA companies to talk to potential investors or to recommend specific investment advice. In turn, this will increase compliance costs, which will inevitably push some users out of the world of IRAs and discourage others from using them.

One estimate predicts that this regulation will disqualify up to 7 million IRA holders from investment advice under these regulations. Another study predicts that between 300,000 and 400,000 fewer IRAs will be opened every year as a result of this regulation. As John Berlau of the Competitive Enterprise Institute points out, this will disproportionately fall on middle class families who could lose $80 billion in savings.

Encouraging Americans to plan for retirement and build a nest egg is a cornerstone of the middle class American Dream. For millions of Americans, the fiduciary rule will take that away.