Trump’s 401(k) Expansion: New Investment Choices Could Change Retirement Planning

President Donald Trump has signed an executive order that could open the door for millions of American workers to invest their retirement savings in asset classes that were previously out of reach.

The order instructs federal agencies to explore ways to allow private equity, real estate, infrastructure projects, commodities, and even certain digital assets to be included in 401(k) and other defined-contribution retirement plans. If regulators follow through, these options could start showing up in retirement accounts as early as 2026.

What’s Changing?

Currently, most 401(k) plans focus heavily on traditional investments like stocks, bonds, and mutual funds. The new directive would broaden the menu to include:

• Private market investments (e.g., private equity, venture capital)
• Direct or indirect real estate holdings
• Infrastructure projects (roads, bridges, renewable energy)
• Commodities
• Digital assets like Bitcoin, when held in actively managed vehicles
• Longevity risk-sharing pools, designed to help retirees manage outliving their savings

While these alternative investments can carry greater volatility, less liquidity, and higher fees, they also have the potential for higher long-term returns and deeper portfolio diversification.

Why This Matters

For decades, these types of investments have been the domain of institutional players pension funds, endowments, and ultra-wealthy individuals. Trump’s order could, in theory, put everyday workers “on the same playing field” as those deep-pocket investors.

“Private investments in 401(k) plans have the potential to improve participant outcomes by providing access to the same range of investments as professional institutional investors,” said Ari Jacobs, Global Head of Investments at Aon. “But implementation requires careful analysis of manager skill, fees, liquidity, and valuation.”

Industry leaders agree the move could significantly reshape how Americans build retirement wealth if handled responsibly.

Expert Opinions: Opportunity Meets Caution

Peter von Lehe of Neuberger Berman says that including private markets in professionally managed retirement products, such as target-date funds, could enhance returns and reduce risk all without individual investors having to navigate the complexity themselves. His firm’s research shows that just a 10% allocation to private equity in a target-date fund could meaningfully increase retirement income over time.

Financial commentator Leanna Haakons called the change “a powerful opportunity that demands careful, informed participation.” She notes that while real estate, venture capital, and digital assets create “vastly expanded diversification opportunities,” they also introduce liquidity challenges and higher management costs meaning education will be key for retirement savers.

When Could This Happen?

The executive order kicks off a regulatory process involving the Department of Labor, the Treasury Department, and the Securities and Exchange Commission. These agencies will determine how to integrate the new investment options while ensuring investor protections. The rollout is unlikely before 2026, but plan providers are already paying close attention

The Bottom Line

If implemented carefully, Trump’s 401(k) expansion could represent one of the biggest shifts in retirement savings in decades. By giving workers access to alternative investments, it could unlock new ways to grow wealth but it also raises the stakes for investor education, risk management, and regulatory oversight.

As with any major portfolio change, the rule of thumb remains: know what you’re investing in before you jump in. For direct financing consultations or mortgage options for you visit 👉 Nadlan Capital Group.