401K Control

Is it a good idea to have a self-directed 401k?

Who can help with your 401(k)?

Exploring an SDBA (Self-Directed Brokerage Account) can potentially provide access to third-party management services for your retirement plan investments.

WHAT IS A SELF-DIRECTED BROKERAGE ACCOUNT? (SDBA)

An SDBA, or Self-Directed Brokerage Account, is a window inside a company-sponsored retirement plan (401(k), 403(b), 457, etc.) which offers plan participants the option to invest in more than the limited pre-selected company choices.

To explain further, A Self-Directed Brokerage Account (SDBA) is an investment account that allows you to invest in a wider range of assets than those typically offered in traditional retirement plans. In addition to stocks, bonds, and mutual funds, SDBAs may provide access to alternative investments like real estate, private equity, and precious metals.

SHOULD I MANAGE MY OWN 401(K) INVESTMENTS?

A Self Directed Brokerage Account within your 401(k) could provide access to proprietary third-party professional money management. Some other potential advantages might include:

  • Taking control of your retirement plan with more investment options and potentially greater diversification
  • Access to personalized advice inside your 401(k)
  • Access to third-party active management
  • Potential to sidestep bear markets through additional management strategies
  • Remain a participant in the 401(k) plan, continue to make contributions and receive any available employer match

"In a 2014 Financial Engines/AON Hewitt study, the annual median performance gap return between participants that had help and participants that did not have help was 3.32%, net of fees over the period 2006–2012. This difference can have a meaningful impact on wealth accumulation over time. For a 45-year old participant that seeks the help of a financial professional it could translate to 79% more wealth at age 65.3."

— FINANCIAL ENGINES & AON HEWITT

Is a Self-Directed 401(k) Right for You?

BEFORE GETTING STARTED WITH A SELF-DIRECTED BROKERAGE ACCOUNT (SDBA) - IDENTIFY THE OPPORTUNITY – CONTACT US TO FIND OUT IF YOU HAVE AN ELIGIBLE PLAN.

We will call your 401(k) plan custodian together or refer to the plan summary to determine the following:

  • Determine if third-party management is available.
  • Determine the minimum core balance requirement and other important factors.
  • Determine if there is any paperwork that requires the plan administrator's signature.