Today, President Trump is expected to sign a long-awaited executive order allowing private equity and crypto investments in 401(k) retirement accounts. 

In response, Center for Economic and Policy Research (CEPR) Co-Director Eileen Appelbaum issued the following statement: 

“It is no wonder why the private equity giants want to gain access to the trillions of dollars in workers’ retirement savings accounts. But there are substantial risks here for employers and workers.

“Private equity investments have delivered disappointing returns, making them far less attractive to workers looking for a secure retirement. On the flip side, employers and investment advisors have a fiduciary responsibility to the workers they represent; they would put themselves at legal risk by recommending risky investment options.  

“It is important to remember that during Trump’s first term, the Department of Labor issued guidance that provided employers with the ability to adopt 401(k) plans that include investments in private equity. But there has been little take-up; less than 10 percent of retirement plans offer any kind of alternative investments and investments in private equity are available in only 2.4 percent of them.”

“The president’s executive order is most certainly a gift to the private equity and crypto industries. But workers may not be interested in making risky bets with their retirement accounts.” 

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