Brokerage window

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Brokerage Window

The ability for an account holder to have control over at least some of the investments made on his/her IRA or 401(k). That is, either the account holder or a designated representative has the ability to make investments with the contributions made to the account. This increases the potential return on a retirement account, but also increases the risk associated with it. See also: Self-directed IRA.
Farlex Financial Dictionary. © 2012 Farlex, Inc. All Rights Reserved

Brokerage window.

A 401(k) account that permits its plan participants to buy and sell investments through a designated brokerage account is said to offer a brokerage window.

Any securities trades you authorize for your account are made through this brokerage account. Transaction fees are subtracted as those orders are executed.

Dictionary of Financial Terms. Copyright © 2008 Lightbulb Press, Inc. All Rights Reserved.
References in periodicals archive ?
In "Through the ‘Window,'" John Keefe writes that although many retirement plan advisers are not big fans of brokerage windows, many lawyers, engineers, airline pilots and doctors are.
The report suggests that other flexibility-inducing options designed to prevent leakage, such as allowing brokerage windows or "sidecar IRAs" inside a DC plan, could undermine adoption of qualified default investment alternatives.
Brokerage Windows. A brokerage window allows employees to direct their investments beyond the portfolio selected by the plan sponsor.
The industry had complained that the department had ushered in a new requirement on brokerage windows in its original Field Assistance Bulletin (FAB).
That's whether a broker-dealer would be able to properly identify the payer of indirect compensation in connection with brokerage windows. While the provider of the brokerage window is supposed to disclose indirect compensation through several types of investments that plan participants can make, the provider will not know up front which of those investments a participant will choose.
Members of the AICPA's DOL Liaison Task Force will continue to work with the DOL as it conducts a review of this alternative reporting method for plans with brokerage windows in an effort to determine whether and under what circumstances such method of reporting may need to be modified to ensure adequate information is provided to plan sponsors, participants and beneficiaries, and the DOL, PBGC and IRS in the future.
How do you know if brokerage windows are a good choice for you?
Notwithstanding the growth of TDFs, brokerage windows have become more widely available: The 2019 Defined Contribution Trends Survey from consultant Callan found that 50% of DC plans offered a brokerage window feature last year, up from 15% in 2009.
Summary paragraph: Brokerage windows in 401(k) plans
The Department of Labor's Employee Benefits Security Administration (EBSA) backed off on its controversial fiduciary requirements involving brokerage windows under its fee-disclosure rule 408(b)(2) that had the retirement planning community up in arms.
Summary paragraph: How to help limit the potential risks of brokerage windows
Another important matter under consideration by the DOL, Reish note, is the use of brokerage windows in employer-sponsored retirement plans.