US President Donald Trump has signed a new executive order that significantly expands access to alternative assets for 401(k) retirement plan investors. This decision may impact the investment structure and asset diversification in the country.
Details of the New Order
The signed order allows contribution-based retirement plans like 401(k)s to invest in alternative asset classes. This includes cryptocurrencies, private equity funds, real estate, and other opportunities, which may lead to increased returns and investment diversification.
Changes for 401(k) Investors
The order also directs the Secretary of Labor to revise existing guidance on fiduciary duty related to alternative investments in retirement plans. This will enhance fiduciary compliance procedures when incorporating such investments into mutual funds.
Future of Alternative Asset Regulation
Moreover, the order requires the Department of Labor to collaborate with the Treasury Department, the Securities and Exchange Commission (SEC), and other regulatory agencies to consider parallel regulatory changes. The SEC was also instructed to update regulations to facilitate access to alternative assets for individually managed contribution-based retirement plans.
The signing of this executive order by Trump may significantly change the investment landscape for retirees in the US by providing them with greater options for investing in alternative assets.
