A group of key Republican lawmakers in the House of Representatives signaled support for the Trump administration's move to allow alternative assets, including cryptocurrencies, in 401(k) plans.
House Financial Services Committee Chairman French Hill, R-Ark., and Subcommittee on Capital Markets Chair Ann Wagner, R-Mo., were joined by seven other GOP lawmakers when they wrote to Securities and Exchange Commission (SEC) Chairman Paul Atkins on Monday to express support for the move.
They said President Donald Trump's executive order on the subject has the potential to enhance Americans' retirement savings and encouraged the SEC to work with the Labor Department in revising relevant regulations to make the investments more accessible.
"We applaud the EO's policy 'that every American preparing for retirement should have access to funds that include investments in alternative assets when the relevant plan fiduciary determines that such access provides an appropriate opportunity… to enhance the net risk-adjusted returns," the lawmakers wrote.
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The letter noted that Trump's executive order directs the SEC and Labor Department to determine whether parallel regulatory changes are needed, as well as calling for the SEC to facilitate access to alternative assets for participant-directed defined-contribution retirement savings plans by revising its own regulations.
The GOP lawmakers encouraged the SEC to provide swift assistance to the Labor Department and to make changes to its current regulations and guidance.
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They also included a request that the SEC "review bipartisan legislation being advanced in the 119th Congress concerning accredited investors. We are hopeful that such actions will help the 90 million Americans that are currently restricted from investing in alternative assets to secure a dignified, comfortable retirement."
Last month, Trump signed an executive order opening 401(k) plans to alternative assets, including private market investments, real estate, actively managed investments in digital assets, commodities, infrastructure projects and longevity risk-sharing pools.
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The Labor Department on Tuesday issued an advisory opinion that concluded lifetime income investment options would meet the agency's requirements as a qualified default investment alternative under the Employee Retirement Income Security Act.
It also rescinded a Biden-era guidance from December 2021 that discouraged fiduciaries from considering alternative assets in 401(k) retirement plan investment menus.
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"The Department of Labor is continuing to take swift steps to implement President Trump’s Executive Order," said Labor Secretary Lori Chavez-DeRemer. "Today’s Advisory Opinion is another step forward towards our goal of giving plan fiduciaries the flexibility to design retirement investment strategies that meet the needs of American workers."
