Have you ever come across the acronym SDBA in your retirement plan? It stands for "self-directed brokerage account," and utilizing it can significantly expand your investment options. Another term for SDBA is "Personal Choice Retirement Account" (PCRA). If you have a 401k, 403b, or 457 plan, log in to your retirement account and look for the SDBA or PCRA link. If you find it, contact your advisor right away.
The SDBA or PCRA allows employees to open a brokerage window in their retirement plan, enabling them to invest beyond the core plan's limited options. This allows you to work with an advisor. Typically, an employer’s core plan includes several target-date funds, a few market mutual funds and ETFs, and a couple of bond funds.
Employers like Blue Cross Blue Shield, Westinghouse, FedEx, UPS, and AT&T offer SDBA/PCRA options, allowing their employees greater control over their retirement investments.
A fiduciary must provide investment options that offer acceptable performance while limiting the risk for employees. For those who prefer a hands-off approach, the limited options in a core plan, including target-date funds, provide a straightforward way to invest for the future. However, the SDBA/PCRA is ideal for those who want to take a more proactive role in managing their retirement accounts.
An experienced investor or financial professional should only use the SDBA/PCRA. It offers access to assets typically not found in standard retirement plans. At Milestone Wealth Advisors, we assist our clients in managing their employer-sponsored retirement accounts using the SDBA/PCRA in various ways. This allows us to manage our clients' assets inside their employer plan, which otherwise would not be available.
If you're interested in taking a more active role in managing your employer-sponsored retirement plan, consider utilizing the SDBA/PCRA feature. Your investment strategy should not be limited to a few mutual funds and age-based target-date funds. If you have an SDBA/PCRA in your retirement plan and would like assistance in managing your retirement accounts, please contact us to explore all your options.
Call us at (803) 736-3406 or email Zach@milestonewealthadvisors.com.