President Donald Trump is reportedly preparing to sign an executive order that would expand Americans’ access to private-market investments through their retirement accounts, particularly 401(k) plans.
According to The Wall Street Journal, which cited individuals familiar with the matter, the proposed order would instruct the Labor Department and Securities and Exchange Commission (SEC) to issue new regulatory guidance for employers and plan administrators. The guidance would clarify how private assets—such as private equity, venture capital, real estate, and hedge funds—could be included in 401(k) investment options.
Sources noted that while the order is still under review, the administration is expected to finalize and announce the plan in the coming weeks.
What Are Private-Market Investments?
Unlike traditional assets such as publicly traded stocks and bonds, private-market investments are not listed on public exchanges. They tend to offer higher risk but also the potential for greater returns, making them appealing to investors seeking diversification.
Industry Reaction
Bryan Corbett, president and CEO of the Managed Funds Association (MFA), which represents firms in the alternative asset space, welcomed the anticipated move. Speaking to Reuters, Corbett said:
“Expanding access to alternative investments in 401(k) retirement plans will provide more Americans with the diversification and investment options needed to build wealth and save for a successful retirement.”
Policy Reversal from Biden-Era Guidance
During Trump’s first term, the Labor Department issued guidance in 2020 stating that private equity could be responsibly included in certain retirement investment vehicles—like target-date funds—provided fiduciaries properly assess risk and fees.
That position was later reversed by the Biden administration in 2021, which said it would not endorse or recommend including such private assets in retirement plans due to concerns about complexity and transparency.
Financial Industry Preparing for Shift
In anticipation of Trump’s expected order, several asset managers have already launched or announced products aimed at retirement plans that include private-market components:
- Apollo Global Management and State Street have developed a target-date fund with exposure to private assets.
- Blue Owl Capital announced a partnership with Voya Financial to deliver similar offerings.
Why It Matters
If enacted, Trump’s executive order could reshape how Americans invest for retirement, potentially unlocking trillions of dollars in 401(k) funds for alternative investment strategies. Supporters argue it would offer greater diversification and return potential. Critics, however, may raise concerns about transparency, fees, and risk exposure for everyday investors.
The move comes as part of a broader economic push from Trump allies to revise retirement and digital asset policies, including reversing Biden-era ESG rules and promoting U.S. leadership in alternative finance sectors.
