The Department of Labor's Employee Benefits Security Administration has had brokerage windows on its radar since the agency issued final regulations on investment and fee disclosure for participant-directed retirement plans in October of 2010.
The latest evidence that they remain on its radar is EBSA's request-for-information in August asking for public comment on these investing arrangements in individual account-type plans, such as 401(k)s.
EBSA is asking the public and those in the industry a series of 39 questions, the stated purpose being to determine "whether, and to what extent, regulatory standards or other guidance concerning the use of brokerage windows … are necessary to protect participants' retirement savings."
Also read: Keep brokerage windows in 401(k)s down
For the unfamiliar, a brokerage window in a retirement plan is a portal through which a participant can select from a virtually limitless array of investment choices; much broader than a typical selection of investments available to retirement plan participants.
It is an option we most often see used by experienced investors who are motivated to research and inform themselves on both conventional and unconventional investments, and do not want to be restricted to a preselected menu of mutual funds, annuity products, or other traditional investments.
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