Labor Department Seeks to Rewrite 1977 Rule, Opening $20 Trillion Alternatives Market to 401(k) Savers
Updated
Updated · RealClearMarkets · Jun 29
Labor Department Seeks to Rewrite 1977 Rule, Opening $20 Trillion Alternatives Market to 401(k) Savers
2 articles · Updated · RealClearMarkets · Jun 29
Summary
June comments closed on a Labor Department proposal to modernize Prohibited Transaction Exemption 77-4, a Carter-era rule that officials say limits 401(k) access to alternative assets.
The push follows Trump’s August 2025 executive order and aims to let retirement plans consider private infrastructure, private equity, real estate, digital assets and other fast-growing sectors under existing ERISA fiduciary duties.
Supporters argue the current framework leaves workplace savers with narrower choices than state pension funds and wealthy investors, widening gaps in access to parts of the economy estimated at $20 trillion.
The debate lands as retirement pressure builds more broadly: more than 60% of Americans own stocks, while Social Security’s trust fund is projected to be depleted by 2032, triggering a 22% benefit cut without congressional action.