Your 401(k) could be in for a quiet but major makeover, and it’s not necessarily one you’ll get much say in, writes Paul Kiel at ProPublica. The Trump administration is advancing a Labor Department rule that would make it harder for workers to sue employers over mismanaged retirement plans—while simultaneously nudging companies to load 401(k)s with complex, higher-fee investments like private equity, hedge funds, and crypto. The shift centers on the director of the Employee Benefits Security Administration, Daniel Aronowitz, a former industry consultant whose company helped employers defend against lawsuits over retirement plans. His proposal would give employers a legal “safe harbor” if they can show they followed a prescribed process in picking investments, even if those choices leave workers paying steep fees for opaque products.
Supporters argue the changes could give ordinary investors access to assets once reserved for institutions and wealthy clients, potentially boosting returns and diversification. Critics counter that many alternative investments are expensive, hard to value, and difficult to sell quickly. They also warn that reducing employers’ liability could weaken one of the main protections keeping high-fee products out of workers’ retirement accounts. Kiel explores how the battle isn’t simply about expanding investment choices. It’s about who bears the risk—and whether the guardrails built into the 401(k) system will remain in place as Wall Street seeks a larger slice of Americans’ roughly $10 trillion in retirement savings. Read the full story.