The rules governing your retirement plan may be changing.
As we reported in July, President Donald Trump wants to encourage 401(k) plans to invest more in private equity, real estate and cryptocurrency, which can be complex and risky. To pave the way, the Department of Labor has proposed rules that would make it harder for employees to hold companies liable for how they oversee retirement plans.
Employers are required to serve the best interests of their employees when choosing investment options. Under the proposed changes, a company that follows a certain process would get the benefit of the doubt in court, making it harder for workers to sue over the management of their 401(k).
A spokesperson for the Department of Labor did not respond to requests for comment. In an announcement from March, the department said the proposed rule change will “democratize access to alternative investments in 401(k) plans” and “lower litigation risks” for employers who are acting with good judgment.
The new rules, expected to be finalized this year, also raise broader questions: What investment options are already offered in people’s retirement accounts, and what are people paying in fees?
