By Keiter CPAs
Key update: Employer-sponsored defined-contribution 401(k) plan scope has now been expanded to include alternative asset investments
On August 7, 2025, President Donald J. Trump issued an executive order which expands access to alternative asset investments within employer-sponsored defined-contribution 401(k) retirement plans.
Investments included within the scope of alternative asset investments
Alternative assets investments, as denoted by this executive order, are further defined as:
- Private market investments that are not traded on public exchanges;
- Interests in real estate;
- Holdings in actively managed investment vehicles that are investing in digital assets (i.e.: Cryptocurrency);
- Investments in commodities;
- Interests in projects financing infrastructure development;
- And lifetime income investment strategies.
How does this impact employers and their participants, and what are the risks?
Alternative asset investment strategies tend to carry higher risks overall. These investments are typically not as liquid as a publicly traded security or index/ mutual fund, tend to be more expensive than traditional investment securities often due to higher management fees, and oftentimes have complex structures that require a thorough understanding of the investment. Given this, participants could be directly exposed to more risk and the volatility that comes with these alternative assets as opposed to traditional investment options within 401(k) plans. While alternative asset investment strategies can add more risk to retirement plan investing, they can also provide more diversification and opportunities for non-market correlated returns. Employers and fiduciaries will need to be both diligent and proactive to ensure their investment offerings are appropriate, as well as assess the risks and benefits of certain alternative asset investments offered under their defined contribution 401(k) plans.
Action items for Secretary of Labor, Department of Labor, and Securities and Exchange Commission
Within 180 days of the order, effective February 3, 2026, the Secretary of Labor will reexamine the Department of Labor’s past and present guidance regarding a fiduciary’s duties under current Employee Retirement Income Security Act of 1974 (“ERISA”) guidance in connection with making alternative asset plan asset allocations available to authorized participants. Within this period, the Secretary of Labor shall further clarify the Department of Labor’s position on alternative assets and consult with the SEC to carry out the objectives of this order.
For guidance on balancing opportunity and risk with alternative assets in your 401(k) plan, contact your Keiter Opportunity Advisor to start a conversation.
Source: White House.gov
About the Author
Keiter CPAs
Driven by our core values of innovation, collaboration, relationships, and accountability, we serve as trusted Opportunity Advisors, providing tailored advice to help you make confident, forward-looking decisions.
Our comprehensive services include audit and assurance, tax, cybersecurity, risk advisory, valuation and forensic services, and transaction advisory services. We specialize in supporting entrepreneurs, private business owners, and organizations across industries such as financial services, construction, healthcare and medical services, real estate, manufacturing, retail & distribution, private equity and institutional investors, technology and nonprofits.
More Insights from Keiter CPAsThe information contained within this article is provided for informational purposes only and is current as of the date published. Online readers are advised not to act upon this information without seeking the service of a professional accountant, as this article is not a substitute for obtaining accounting, tax, or financial advice from a professional accountant.
