President Donald Trump has signed an executive order that paves the way for private equity, real estate, cryptocurrency, and other alternative assets to be included in US 401(k) retirement plans, a potential game-changer for the $12.5tn defined-contribution market, Bloomberg reports.

Under the order, the US Department of Labor must, within six months, reassess its guidance on alternative investments in retirement accounts governed by the Employee Retirement Income Security Act. The department will also clarify fiduciary obligations for plan administrators offering asset allocation funds containing alternative holdings.

The directive instructs Labour Secretary Lori Chavez-DeRemer to coordinate with the Treasury Department, the SEC, and other agencies to explore potential rule changes that would ease access. The SEC has been specifically tasked with facilitating alternative asset inclusion in participant-directed plans.

This is the administration’s most significant step yet to bring private assets into 401(k)s and follows earlier guidance from Trump’s first term, rolled back under President Biden, which allowed private equity in retirement portfolios without breaching fiduciary duties.

The change comes as private equity managers seek new capital sources, with many institutional investors already at their allocation limits amid slower dealmaking and reduced distributions. Advocates argue that expanding access could offer savers greater choice and potential returns, though it carries higher risks and fees.

The initiative also aligns with Trump’s broader pro-crypto agenda, which has included hosting “Crypto Week” at the White House, enacting the first federal stablecoin law, and creating a Strategic Bitcoin Reserve.

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