Financial Freedom Act of 2025

House Votes

This proposal would stop the Department of Labor from limiting which investment options can be offered in certain employer retirement plans where you choose your own investments, like 401(k)s with a self-directed brokerage window. Plan managers could offer a wide range of choices, and no type of investment would be favored or disfavored except based on normal risk and return.

It also says that if a plan includes a self-directed brokerage window, the Department of Labor may not issue rules or guidance that restrict what can be offered through it, and offering that window does not break the usual “prudence” or “diversification” duties just because participants pick their own investments there.

Key points:

• Who is affected: Workers and retirees in defined contribution plans where they pick their own investments (for example, some 401(k)s), and the plan managers who set the menu.
• What changes: The Department of Labor could not narrow the range or type of investments offered; choices should be judged by risk and return, not by category.
• Self-directed brokerage windows: No new limits from the Department of Labor; simply offering this option would not, by itself, violate prudence or diversification rules.
• When: Would apply if enacted into law.