Trump wants Americans to invest retirement funds in crypto
US President Donald Trump is moving to make it easier for Americans to use their retirement savings to invest in non-traditional assets like cryptocurrencies, private equity, property, and gold.
On Thursday, he directed regulators to review rules that might discourage employers from offering such investment options in workplace retirement plans, known in the US as 401(k)s.
The move is intended to broaden access to investments once limited to the wealthy and institutional investors, while also unlocking new sources of capital for firms operating in those alternative asset sectors.
However, critics have raised concerns that the move could expose savers to higher risks.
In the US, most employers no longer offer traditional pensions with guaranteed payouts. Instead, employees typically contribute part of their salary to investment accounts, often matched in part by their employers. These accounts are governed by strict regulations requiring plan providers to consider factors like risk and cost when selecting investment options.
Historically, many employers have avoided adding options like private equity to retirement plans due to their higher fees, reduced transparency, and lower liquidity compared to traditional stocks or bonds.
Trump’s order gives the Department of Labor 180 days to assess current rules. Experts say any significant changes would take time to implement.
Investment giants such as State Street and Vanguard have already begun exploring such territory, teaming up with firms like Apollo Global and Blackstone to offer private-equity-focused retirement products.
Trump’s own business interests include firms tied to cryptocurrencies and investment platforms. In May, the Department of Labor rescinded 2022 guidance that had advised firms to exercise “extreme care” before adding crypto to retirement plan options.
During Trump’s first term, his administration encouraged retirement plans to consider private equity investments, but legal concerns limited adoption. That guidance was later reversed by President Joe Biden.