US Labor Department Proposes Expanded Investment Options for 401(k) Participants

The US Department of Labor's Employee Benefits Security Administration has introduced a proposed regulation that would expand the range of investments available to 401(k) plan participants.

Under the proposal, managers of defined contribution plans would be allowed to consider investing in alternative assets such as private equity and cryptocurrencies. The new rule is intended to alleviate regulatory burdens and litigation risk that have hindered access to these investment options for American workers.

The proposed regulation outlines a set of process-based safe harbors for plan fiduciaries to use when selecting designated investment alternatives, including digital assets, commodities, and infrastructure development projects.