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What is a Brokerage Window?
Many employer-sponsored group retirement plans have an option for their employees called a "brokerage window".
This option, also known as a Self-Directed Brokerage Account (SDBA), exists in thousands of 401(k), 403(b), and 457 plans across the country.
Using SDBA is a great way for financial professionals to help their clients personalize their retirement plan investments.
How it Works
Most employee-sponsored group retirement plans have "core" investment offerings for employees to contribute to while they work and save for retirement.
Core plan options are often fine but limited. Many plans now also offer a brokerage window or SDBA option in addition to the core options.
The SDBA is always linked to the core plan, so the employee's savings never leave the tax-shelter of the group plan.
The SDBA not only expands the scope of investments beyond the core, but it allows for personalized advice.
Coaching Is Key
In the world of investing, embracing our human instincts can often lead to costly errors. Logic and strategy must prevail over emotion.
This is where the value of a financial advisor shines through.
With the guidance of a financial "coach," navigating, and steering clear of common behavioral pitfalls is much easier.
