Editor’s note: He signed it.
U.S. President Donald Trump is expected to sign an executive order on Thursday that would allow private equity and cryptocurrencies into Americans’ 401(k)s, appeasing corporate interests that lobbied for the change and disregarding warnings about the risks it poses to retirement accounts.
Citing an unnamed senior White House official, CNN reported that “the order calls for the Labor Department and Securities and Exchange Commission to issue guidance to employers about providing access to those alternative investments in their retirement accounts.”
Yep - exactly right. I didn’t say the new rule wasn’t colossally stupid, but it gives everyone a greater ability to gamble with their retirement. “Luckily” they don’t work like a pension which you have no control over. Example: if your employer decided to invest in Trump coin and then your pension fund tanked. That would be a different level of horrible, but in this case, the rule is giving us all new ways to be stupid with our money (by choice).
Agreed. My concern, beyond the executive overreach that others have mentioned, is that employers could theoretically remove all other options from your available investment vehicles. That would be even more colossally stupid, and I don’t expect it to happen, but that would be the other way this could bite regular people even if they know better. At least they should give you the option to roll your account over into an independently managed IRA before liquidating everything.
Get what you’re saying, but that sounds like a bit of a stretch. If any employer did want to go all in on stupid like that, people would still be able to do the following: