Trump's alt. asset 401(k) executive order: What you should know

00:00 Speaker A

President Trump’s new executive order is aimed at giving retirement savers more choices. It would open the door for 401k investors to go beyond just stocks and bonds and put money into things like Bitcoin, real estate or even private equity. Now what that actually looks like is still unclear. There is no immediate change to how you invest. The order directs the SEC and the Labor Department to draft guidelines for plan administrators who will ultimately decide whether to include these options, and that could take months or even longer. But once that’s done, employers could offer more options of mutual funds and investments to workers. Some big asset managers are already supportive. BlackRock CEO Larry Fink recently argued in his annual investor letter that private assets like real estate and infrastructure can boost returns and provide a buffer when markets get choppy. But not everyone is convinced. Some advisors warn that these investments come with more risk and less transparency. As legendary fund manager Peter Lynch put it, own what you know, and if you don’t know it, stick with the basics.