Labor Department Draws 33,000 Comments on 401(k) Alternatives Rule for $14.2 Trillion Market
Updated
Updated · Reuters · Jun 2
Labor Department Draws 33,000 Comments on 401(k) Alternatives Rule for $14.2 Trillion Market
2 articles · Updated · Reuters · Jun 2
More than 33,000 comments hit the Labor Department's proposal to let 401(k) plans include alternative assets such as private credit and cryptocurrencies, closing a review period that exposed a sharp split between industry backers and investor advocates.
The rule would give employers a legal safe harbor from investor lawsuits if they thoroughly assess performance, fees, liquidity, valuation, benchmarks and complexity before adding those investments.
Fund groups including the Investment Company Institute and Managed Funds Association backed broader access, with ICI urging only modest private-market allocations through target-date funds that dominate workplace retirement plans.
Critics including the CFA Institute and some advisers warned retail savers could face higher fees, weaker control over manager selection and dangerous liquidity mismatches in vehicles such as interval funds.
The department now reviews the comments, may revise the proposal and still needs White House clearance before any final rule affecting the $14.2 trillion employer-sponsored retirement market is published.