Original Title: DEMOCRATIZING ACCESS TO ALTERNATIVE ASSETS FOR 401(K) INVESTORS
Original Source: The White House
Original Translation: Golden Finance
By the authority vested in me as President by the Constitution and laws of the United States, I hereby order:
Section 1: Purpose. Many affluent Americans and government workers participating in public pension plans can invest in various alternative assets or benefit from these investments. However, although more than 90 million Americans participate in employer-sponsored defined contribution plans, the vast majority of these investors do not have the opportunity to directly or indirectly participate in the potential growth and diversification opportunities presented by alternative asset investments through their retirement plans.
Trustees of 401(k) plans and other defined contribution retirement plans must carefully review and consider all aspects of private equity products, including the capabilities, experience, and effectiveness of investment managers in managing alternative asset investments. They do this to protect the retirement accounts of Americans under their management and to fulfill their fiduciary duty of prudent and secure investing.
During my first term, my administration issued a 2020 information letter acknowledging that prudent federal actions can encourage the promotion of investment strategies, whereby a portion of the interests of retirement plan participants is allocated to alternative assets, similar to the arrangements of institutional investors.
However, the burdensome litigation attempting to challenge the reasonable decisions of loyal and regulated trustees, along with the stifling guidance issued by the Department of Labor since my first term, has deprived millions of Americans of the opportunity to benefit from alternative asset investments. These assets have increasingly represented a significant portion of the investment portfolios of public pensions and fixed-income retirement plans, providing not only competitive returns but also opportunities for diversified investments.
A combination of excessive regulatory intervention and lawsuits by opportunistic litigators has stifled investment innovation, resulting in participants in 401(k) plans and other defined contribution retirement plans largely being limited to asset classes that generate long-term net returns that are significantly lower than those available to public pension funds and other institutional investors.
My administration will alleviate the regulatory burdens and litigation risks that hinder competitive returns and asset diversification for American workers' retirement accounts, which are crucial to ensuring a dignified and comfortable retirement.
Section 2: Strategy. The policy of the United States is that every American preparing for retirement should have the opportunity to access funds that include alternative asset investments, provided that the relevant plan trustees determine that such opportunities can provide appropriate chances for plan participants and beneficiaries to enhance the risk-adjusted net returns on their retirement assets.
Section 3: Democratizing Access to Alternative Assets. (a) For the purposes of this order, the term 'alternative assets' refers to:
(i) Private market investments, including direct and indirect equity, debt, or other financial instruments that are not traded on public exchanges, including investments where the managers (if applicable) seek to play an active role in the management of these companies;
(ii) Direct or indirect real estate interests, including debt instruments secured by direct or indirect real estate interests;
(iii) Actively managed investment vehicles holding investments in digital assets;
(iv) Direct and indirect commodity investments;
(v) Direct and indirect benefits from infrastructure financing projects; and
(vi) Lifetime income investment strategies, including longevity risk-sharing pooled funds.
(b) Within 180 days of the issuance of this order, the Secretary of Labor (hereinafter referred to as the 'Secretary') shall review the Department of Labor's past and current guidance regarding the fiduciary obligations of trustees under the Employee Retirement Income Security Act of 1974 (as amended) (29 USC 1104) concerning the provision of asset allocation funds that include alternative asset investments to participants. In conducting this review, the Secretary shall consider whether to rescind the Department of Labor's supplemental private equity statement issued on December 21, 2021.
(c) Within 180 days of the issuance of this order, the Secretary shall, as appropriate and consistent with applicable law, further seek clarification of the Department of Labor's position on alternative assets, as well as appropriate fiduciary procedures related to the provision of asset allocation funds that include alternative asset investments under the Employee Retirement Income Security Act (ERISA). Such clarifications must aim to establish standards that trustees should use to prudently balance potential higher expenses against the goal of seeking higher long-term net returns and broader investment diversification. The Secretary shall also propose rules, regulations, or guidance, as deemed appropriate, to clarify the obligations of trustees under ERISA to plan participants when deciding whether to offer asset allocation funds that include alternative asset investments, which may include appropriately calibrated safe harbor provisions. In executing the directives of this section to further the policies set forth in this order, the Secretary shall prioritize actions to curb ERISA litigation that restricts trustees' ability to use their best judgment in providing investment opportunities to relevant plan participants.
(d) In executing the directives of this section, the Secretary shall consult with the Secretary of the Treasury, the Securities and Exchange Commission (SEC), and other federal regulatory agencies as necessary to achieve the policy objectives of this order, including parallel regulatory changes that other federal regulatory agencies may incorporate.
(e) The SEC shall consult with the Secretary to consider how to facilitate the investment in alternative assets for participants in participant-directed defined contribution retirement savings plans (PDS). Such facilitation measures may include, but are not limited to, considering revisions to SEC regulations and guidance related to the qualifications of accredited investors (ADS) and qualified purchasers (QPI) to achieve the policy objectives of this executive order.
Section 4: General Provisions. (a) Nothing in this order shall be construed to impair or otherwise affect:
(i) the authority granted by law to executive departments or agencies or their heads; or
(ii) Functions related to the Director of the Office of Management and Budget concerning budget, administrative, or legislative proposals.
(b) This order shall be implemented consistent with applicable law and subject to the availability of appropriations.
(c) This order is not intended to, and does not create, any substantive or procedural rights or benefits that any party may enforce against the United States, its departments, agencies, or entities, its officers, employees, or agents, or any other person.
(d) The costs of issuing this order shall be borne by the Department of Labor.
Donald J. Trump
The White House
August 7, 2025
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