Are Alternative Assets Coming to Defined Contribution Plans? President Trump’s August 7 Executive Order Seeks to “Democratize Access to Alternative Assets”

Published on August 25, 2025

Investors with self-directed retirement plans certainly know the value of including alternative assets within their plans. It seems that idea may be catching on if President Donald Trump has any say on that. According to Whitehouse.gov, his executive order, signed on August 7, intends “to allow 401(k) investors to access alternative assets for better returns and diversification.” It directs government officials in the U.S. Department of Labor (DOL) to look at the inclusion of private equities, real estate investments, commodities, infrastructure projects, and cryptocurrencies in 401(k) and other defined contribution (DC) plans.

Just as account owners of self-directed IRAs (and others, such as solo k plans) are already including…and have done so since the establishment of IRAs in the mid-1970s.

That executive order’s mandate directs the DOL to review its guidance on alternative investments in retirement plans, clarify its position surrounding the private market, and explain the appropriate fiduciary process in offering alternative investments under ERISA.  The DOL has 180 from the date of the executive order to complete its tasks.

The SEC will also have to consider revising existing regulations and guidance relating to accredited investor and qualified purchaser status. Read the full order, “Democratizing Access to Alternative Assets for 401(k) Investors here.

Alternative assets build portfolio diversity and resiliency

As administrators and custodians of self-directed IRAs and other plans, we know firsthand that expanded investment options enable account owners to build more diverse (and potentially more lucrative) portfolios. Relaxing the regulations that currently prohibit alternative assets in employer-sponsored plans means more people will have access to the many benefits our clients are already enjoying. However, as our clients and team know, self-direction allows for an even broader array of non-traditional investments, such as royalties, promissory notes, and natural resources.

We applaud efforts to put investment decisions in the hands of account owners, of course, and to reduce barriers to investing opportunities beyond stocks, bonds, and mutual funds. If the federal government updates its guidance and regulations to allow participants to include the alternative assets in their DC plan, employers and participants (and fund administrators) will likely require some education and get professional financial advice about private market funds, digital assets, and real estate investments, as these will add complexity to the plans.

It should be noted that some opponents in the financial services space are voicing concerns, fearing that participants may do themselves financial harm without the proper education and understanding of how these investments work (to the investor’s advantage).

Additionally, we feel that employers and plan sponsors who end up offering these “new” assets to participants should proceed with caution, as they can be sued if participants’ plans realize losses on those investments. Therefore, even with regulatory change, if plan sponsors aren’t somehow shielded from litigation, this may not go anywhere.

This is unlike the situation with self-directed investors, who are comfortable making their own investment decisions, conducting their own full due diligence and research before sending instructions to the administrator—and taking responsibility for their investment choices.

We will be watching this matter as the DOL and SEC do their work and share any updates as they arise.