Retirement Fairness for Charities and Educational Institutions Act of 2025

This bill would permit 403(b) retirement plans, which serve employees of public schools, charities, and churches, to invest in collective investment trusts and insurance company separate accounts. These investment options consist of pooled assets managed by banks, trust companies, or insurance providers.

This bill affects employees of public schools, charities, and churches who participate in 403(b) retirement plans. It also impacts the financial institutions that manage these plans, specifically banks, trust companies, and insurance companies that offer collective investment trusts or separate accounts.

• Expansion of 403(b) investment options to collective investment trusts. The bill permits 403(b) retirement plans, which serve employees of public schools, charities, and churches, to invest in collective investment trusts managed by banks or trust companies.
• Authorization for insurance company separate account investments. The legislation allows 403(b) retirement plans to invest in insurance company separate accounts as part of their pooled investment assets.

This bill modifies the investment authorities for 403(b) retirement plans, which are existing tax-advantaged accounts designed for employees of public schools, charities, and churches. It expands the types of assets these plans may hold to include collective investment trusts and insurance company separate accounts.

The bill aims to expand investment options for 403(b) retirement plans by permitting them to invest in insurance company separate accounts and collective investment trusts managed by banks or trust companies.