RIA Washington Watch: Six issues that could move markets in 2026

What is RIA Washington Watch?

Every quarter, RIA Washington Watch brings you the most up-to-date information on registered investment advisor news and policy changes to help your firm make informed decisions.

This report is current as of February 12, 2026

In these early days of 2026, we've already seen a number of policy and political developments that have directly impacted the markets, including the U.S. military operation in Venezuela, threats and negotiations over Greenland, and threats against the independence of the Federal Reserve. With 2026 being a midterm election year, the frenetic pace in Washington will likely continue.

In this update, we'll flag some key issues that RIAs will want to watch in the months ahead.

But first, there were a couple of notable developments at the end of 2025 that all RIAs should know about:

INVEST Act. In December, the House passed the INVEST Act, which packaged together 22 financial services bills. The legislation includes the long-awaited e-delivery bill, which would allow firms to send regulatory documents to investors electronically by default (though investors could opt in at any time to continue receiving paper documents). Other notable provisions in the bill include allowing 403(b) plans to invest in collective investment trusts (CITs), as 401(k) plans can do today; expanding the ways in which an individual can qualify as an accredited investor; and launching an SEC task force on older investors. The bill now awaits action in the Senate.

Postponed anti-money laundering rule. On December 31, the Treasury Department, as expected, finalized a two-year delay in the anti-money laundering rule for RIAs, which was set to go into effect on January 1. The new effective date will be January 1, 2028, but it is widely expected that the rule will be modified and rewritten. The SEC is also expected to propose revisions to the Customer Identification Program (CIP) later this year.

Looking ahead to key issues in 2026

We see six areas where policy and political developments have the potential to impact the markets. Advisors should keep an eye on these key areas:

Federal Reserve. The Fed's monetary policy decision-making will always be critically important to the markets, but as 2026 began, monetary policy seemed almost secondary to the barrage of other headlines surrounding the Fed. The central bank's independence, a cornerstone of the global financial system for decades, has become a critical issue as the president has sought to fire a sitting Fed governor and his administration has launched a criminal investigation of Chair Jerome Powell. On January 30, the president nominated Kevin Warsh as the next Fed chair to succeed Powell when his term ends in May. Warsh, who served as a Fed governor from 2006 to 2011, will need to go through the Senate confirmation process, where Fed independence is likely to be a prominent issue.

Geopolitics. The year started off with a military operation in Venezuela that removed that country's president. But the administration has asserted that the United States is now "running" Venezuela, raising thorny questions in Congress and among investors about the long-term plan and the implications for Venezuela's oil industry. The president quickly pivoted to his desire to acquire Greenland, with his saber-rattling sparking a notable sell-off on Wall Street before he announced a deal with European allies. Other hot spots include Iran, Israel and Gaza, and the ongoing war between Ukraine and Russia—none of which have easy solutions. Investors seem to be feeling increasingly jittery about U.S. foreign policy.

Courts. The Supreme Court has two massive cases on its hands right now concerning the legality of the president's tariffs and his attempt to fire a sitting Fed governor.

• Tariffs. In oral arguments last November, the Court seemed skeptical that the president properly used an emergency authority to impose tariffs, raising the possibility of the Court overturning the tariffs and potentially triggering a complicated refund process. However, the president has other mechanisms available to him to impose tariffs—so even if the Court rules against the administration, tariffs likely aren't going away. A ruling in the case could come as soon as mid-February.
• Fed independence. The Court heard arguments on January 21 in the case of whether the president can fire Fed Governor Lisa Cook. Justices seemed skeptical that Cook had been afforded a proper process when President Trump attempted to fire her last August. (Lower courts have allowed her to remain in her role at the Fed while the case plays out.) It's unclear whether the court will rule narrowly on the process or, as some justices raised during arguments, more broadly on the question of Fed independence. A decision is expected later this year.

Congress. Midterm election years tend to be lighter on legislative developments as members of Congress increasingly focus on their re-election campaigns, while bipartisanship—already in short supply—dwindles further. But we are keeping our eyes on whether Congress will support any of several "affordability" proposals put forth by the White House. The president has floated ideas like imposing a 10% cap on credit card interest rates, allowing 401(k) withdrawals for down payments on homes, and banning institutional investors from buying up single-family homes—all of which would need Congressional action. Health care also remains on the front burner in the wake of the expiration (at the end of 2025) of subsidies that helped lower premiums for about 22 million Americans who buy their health insurance through the Affordable Care Act. But consensus on health care issues has been notoriously difficult to find on Capitol Hill.

Regulators. Regulatory activity tends to pick up in the second year of a presidential administration, and we expect that to be the case in 2026. The Department of Labor is expected to propose a rule in February to allow 401(k) plans to invest in private markets. The SEC is focused on simplifying disclosure rules for public companies. The CFTC will take on a more prominent role as the primary regulator of cryptocurrency and the burgeoning prediction markets. By mid-year, Treasury and the IRS are planning to launch "Trump Accounts," which will provide $1,000 in a starter investment account for newborns.

Midterm elections. Washington is already fully in election mode. With nine months to go until November, a lot can—and will—change. But Democrats are favored to recapture the majority in the House of Representatives, as midterms have historically been a negative for the president's party and Democrats need to flip only a handful of seats to win. Republicans are a slight favorite to retain their majority in the Senate.

We watch Washington, so you can focus on your clients

As you can see, 2026 is shaping up to be (another) busy year in Washington, with the turbulent policy and political landscape potentially impacting the markets. And given the nature of this president and this administration, there are likely to be plenty of developments that can't be anticipated. The current environment is an emotional one for investors, and advisors are undoubtedly seeing some of those emotions come out in conversations with clients. The key, as always, is to help them navigate their feelings and, as much as possible, keep those emotions out of their investing decisions. As always, the Schwab team in Washington will continue to provide RIAs with our latest perspective on policy and political developments to help support those conversations.

What you can do next

• Register for the next Schwab Market Talk to hear the latest information on potential impacts to the market and regulatory changes.
• Tune in to Michael Townsend's biweekly podcast, WashingtonWise, for insights on the policies and politics impacting portfolios.
• Curious about how Schwab helps RIAs? Wealth services, technology, and business support are just the beginning. Whether you're exploring independence or considering a custodian swap, we're here to help you take your next step.