The number of plans offering these accounts has increased. Aon PLC (NYSE:AON), one of the nation’s largest 401(k) plan administrators, shows that 29% of 401(k) plans offered a self-directed option in 2011, up from 18% in 2008. However, the number of participants taking advantage of them is minimal. Fidelity claims 38% of its 401(k) participants are offered this brokerage window, but less than 3% actually use it.
Extension of the Fidelity-BlackRock, Inc. (NYSE:BLK) partnership hints at broader implications that may change this segment of the market. As The Wall Street Journal‘s MarketWatch reported, the deal may likely result in more employers working with Fidelity to include a self-directed brokerage option within their plans. According to BlackRock, Inc. (NYSE:BLK), “To the extent that iShares will be more readily available without transaction fees in those accounts through Fidelity, we think [self-directed brokerage accounts] will become a more attractive option for retirement investors.” Coincidentally, Fidelity is the largest 401(k) plan administrator, boasting 27% U.S. market share.
Foolish bottom line
Allowing investors access to BlackRock, Inc. (NYSE:BLK)’s wildly popular iShares ETFs through their employer-sponsored retirement programs would represent a huge win-win for Fidelity and BlackRock, Inc. (NYSE:BLK). But the two sides of that partnership aren’t the only beneficiaries of the expanded deal: Those 401(k) participants who desire more ETFs, lower costs, and more control over their retirement accounts may eventually emerge as big winners as well.
The article How an ETF Deal May Impact Our Retirement Accounts originally appeared on Fool.com and is written by Nicole Seghetti.
Fool contributor Nicole Seghetti has no position in any stocks mentioned. Follow her on Twitter @NicoleSeghetti. The Motley Fool recommends Aon, BlackRock, and TD Ameritrade. The Motley Fool owns shares of Aon.
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