Trump Opens Door for Alternative Assets in 401(k) Retirement Plans

President Donald Trump signed an executive order on Thursday that paves the way for including alternative assets such as private equity, cryptocurrencies, and real estate in 401(k) and other defined contribution retirement plans.

The document instructs the U.S. Secretary of Labor to review fiduciary guidelines regarding private market investments in these plans, which are regulated under the federal Employee Retirement Income Security Act of 1974 (ERISA). The law sets minimum standards for most retirement plans.

The alternative asset industry, including private fund managers, has long supported broader adoption of these instruments in defined contribution plans. The order marks a significant step toward expanding investment options for plan participants, although it also brings additional risks for investors.

The measure reflects the Trump administration’s objective of providing greater flexibility in structuring retirement portfolios, in a context where alternative investments can potentially generate higher returns but also come with increased volatility.