Wait Continues for DOL Proposed Rule on Alternative Assets
The wait continues for the details of the Department of Labor’s much anticipated proposed rule, “Fiduciary Duties in Selecting Designated Investment Alternatives.”
On Jan. 13, the DOL submitted the proposed rule to the White House Office of Management and Budget (OMB) for review. The review process—which can take up to 90 days—was expected to be expedited to meet a 180-day deadline from the August 7, 2025 Executive Order from President Trump (“Democratizing Access to Alternative Assets for 401(k) Investors”). But that 180-day deadline quietly came and went on Tuesday, Feb. 3.
Much anticipated proposed rule still under review by White House Office of Management and Budget despite a Feb. 3 deadline for its release
It remains to be seen whether the recent abbreviated government shutdown had any impact on the timing of the proposed rule’s release, which will trigger a comment period that is expected to run for 60 days but could be as short as 30 days. A potential final rule could then be published later in 2026, allowing for implementation in 2027.
President Trump’s Executive Order directed the DOL to reevaluate previous guidance around alternative asset investments in retirement plans and to clarify the government’s position on the fiduciary responsibilities associated with offering asset allocation funds that include alternative holdings, and, as it deems appropriate and consistent with applicable law, to propose new guidance (including safe harbors) that would curb ERISA litigation that constrains ERISA fiduciaries’ ability to apply their best judgment in allowing alternative investments for DC Plan participants.
As pointed out in a Feb. 2 Fact Sheet from the Economic Policy Institute, the DOL under the second Trump administration on August 12, 2025 dutifully rescinded earlier Biden-era guidance from 2021 that discouraged private equity in 401(k) plans. That was less than a week after Trump’s order, and was supported by a report from the president’s Council of Economic Advisers touting the supposed benefits of alts for retirement savers.
The DOL then went about its work to craft the proposed rule that was submitted to OMB on Jan. 13. While the specific contents of the proposed rule remain unknown, it is widely expected that will be consistent with the directives of the Executive Order, and will aim to ease restrictions on including alternative assets—such as private equity, private credit, and digital assets—within 401(k) and other defined contribution plans.
ERISA attorneys say the biggest unknown isn’t whether alternatives will be allowed, but how much legal certainty fiduciaries will actually gain.
“The big question is what the final rule will actually say,” writes a Feb. 5 post on The Rosenbaum Law Firm P.C. Blog. “Will it provide clearer standards for fiduciaries? Will it offer any comfort that private equity, real estate, infrastructure, or even digital assets can be used prudently in defined contribution plans? Or will it simply restate existing fiduciary principles with a new label slapped on the cover?”
The blog goes on to say what’s clear is that the industry is changing whether regulators like it or not. “Providers are pushing alternatives. Sponsors are curious. Participants are asking for diversification beyond the traditional menu. The DOL now has a chance to either bring clarity or add another layer of uncertainty.”
The blog closes by adding that innovation is fine, but under ERISA, process still matters more than novelty. “This proposal could be a turning point—or just another rule that looks important until the first lawsuit tests it. Either way, fiduciaries would be wise to pay attention.”
The Economic Policy Institute’s Fact Sheet argues that the Trump administration’s push to expand access to alternative investments in 401(k) plans would weaken long-standing retirement safeguards and expose everyday savers to higher costs, greater risk, and less transparency.
EPI challenges the administration’s “democratizing access” rationale, noting that many large pension funds are actually pulling back from alternatives due to concerns over fees, illiquidity, valuation opacity, and underwhelming returns—suggesting the industry is seeking new investors as institutional demand wanes. The group warns that loosening DOL and SEC guardrails could undermine fiduciary protections, encourage conflicts of interest, enable tax abuse by wealthy investors, and ultimately erode retirement outcomes, arguing that stronger—not weaker—regulation is needed to protect savers and the broader economy.
Supporters counter that professionally managed structures and clearer guidance could allow fiduciaries to evaluate alternatives without increasing participant risk.
Once the White House Office of Management and Budget completes its review of the DOL’s proposed rule (which could happen at any time but can’t be later than April 13, 2025), the DOL is expected to quickly reveal the contents of the proposed rule for public comment. Stay tuned.
SEE ALSO:
• New Bill Would Codify Trump Alts in 401(k)s EO
• DOL Rescinds Biden-Era Guidance Discouraging Use of Alts in 401(k)s
• DOL Releases 2026 Enforcement Projects
• Private Equity Funds Lag Behind in Performance
• Building the Infrastructure Needed to Bring Private Assets into 401(k)s: A Roadmap for Asset Managers
• Plan Sponsors Express Interest in Private Market Assets
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.