DOL, White House Near Release of Proposed 401(k) Alts Rule

Donachie, P. (2026, January 16). DOL, White House Near Release of Proposed 401(k) Alts Rule. WealthManagement.com. https://www.wealthmanagement.com/regulation-compliance/dol-white-house-near-release-of-proposed-401k-alts-rule

• The U.S. Department of Labor has submitted a proposed rule to the White House Office of Management and Budget intended to facilitate the inclusion of alternative investments in 401(k) plans.

• Titled “Fiduciary Duties in Selecting Designated Investment Alternatives,” the proposal follows a 2025 executive order aimed at expanding access to private equity, real estate, and cryptocurrency within retirement accounts.

• The rule seeks to provide a clearer regulatory framework for plan fiduciaries who have historically avoided illiquid assets due to potential litigation risks and complex ERISA standards.

• Proponents of the measure argue that retail investors require access to private markets to achieve better diversification and capture returns as fewer companies choose to remain public.

• SEC leadership has signaled support for the initiative while advocating for litigation reforms to protect plan sponsors from lawsuits related to alternative investment performance.

• Critics, including prominent Democratic lawmakers, have expressed concerns regarding the transparency, high fees, and general suitability of complex private market products for average retirement savers.

• Once the Office of Management and Budget completes its review, the proposal will be released for a 60-day public comment period before moving toward finalization.

Knote: The OMB typically has 90 days to complete their review but can ask for a 30-day extension if they feel they need it. Then a 60-day public comment period, so it could be a summer event. I’m guessing due diligence is going to be a big thing in this initiative. Entrepreneurs might want to put their thinking caps on as to how they could solve that problem.