Trump’s Labor Department proposes rules that would open 401(k) plans to private equity, private credit and other alternatives, a move aimed at democratizing access to a $14.2 trillion pool of retirement dollars.

Plan sponsors face a choice: add illiquid, high‑fee assets that can swing 25% returns one year to nearly 50% losses the next. Morningstar data show private equity tops at 25% and bottoms at –48% over three years.

Large firms like State Street Global Advisors already offer target‑date funds allocating up to 10 percent to private assets. BlackRock and T. Rowe Price follow suit, promising managed exposure that could dilute returns if not carefully vetted.

Investors must weigh the potential upside against opaque fees, limited liquidity and the risk that only the best‑performing funds attract 401(k) capital, leaving the weaker ones scrambling for capital.