Trump’s plan to change how Americans invest for retirement

US President Donald Trump will soon sign an executive order that would allow 401k pension schemes—currently largely invested in public equities and bonds—to invest in alternative assets such as cryptocurrencies, gold, and private equity, sources on the matter said. It will happen within days and has the potential to revolutionize the $9 trillion US retirement market, the Financial Times further reported.

Alternative assets to include in traditional retirement schemes

Executive order will direct Washington regulatory bodies to locate and remove legal obstacles hindering professionally managed 401k funds from investing in asset classes like digital currencies, corporate takeover funds, private loans, and metals. The White House signalled Trump is actively “securing [Americans’] economic future,” though no move is guaranteed unless done by the president himself.

Effort to bring crypto to the mainstream of retirement investing

Trump has positioned himself as a friend to the crypto space, arguing that previous regulations stifled innovation. His government has already undone a Department of Labor rule under Biden that discouraged crypto from 401k plans. At the same time, the House of Representatives recently passed a set of crypto-friendly bills supported by Trump. Trump has credited the backing of crypto enthusiasts for his victory in the 2024 election and his family’s Trump Media & Technology Group’s more than $2 billion in digital asset holdings, such as launching a new stablecoin.

A triumph of private equity giants

The move would also help big private capital firms such as Blackstone, Apollo, and BlackRock, which have eyed the vast retirement savings pool for some years as a growth engine. The firms argue that 401k take-up would channel hundreds of billions of dollars into private markets. Others such as Blackstone and Apollo have already partnered with the big 401k providers such as Vanguard and Empower.

Legal shield mooted for retirement plan providers

In order to facilitate this shift, Trump’s directive is expected to call for a “safe harbour” provision that would lower legal risks for plan administrators offering these higher-fee, harder-to-value assets to retail savers. The intention is to minimize legal risks of including less liquid assets in mainstream retirement portfolios.

Risks of less liquidity and transparency

Whereas the initiative creates new avenues for investment by savers, it is also raising transparency, valuation, and liquidity concerns. Private equity and cryptocurrencies are typically not as clearly priced and as easily accessible in markets as traditional securities. A risk of bringing more danger into retirement portfolios is being warned about, according to experts, through these characteristics along with the incurrence of higher management fees and leverage utilization.

Trump’s proposal could trigger the biggest American retirement investing upheaval in decades by introducing a broader selection of asset classes into the mix. Supporters point out that it promotes innovation and diversification, whereas critics caution that less sophisticated investors could be saddled with opaque and complex products. Either way, the move amounts to an unmistakable attempt on the part of the Trump administration to reengineer the US’s future retirement savings.