Nothing says retirement fund stability like Bitcoin! Guess I'll kiss my 401k savings goodbye as some AI junkie running the fund puts it into crypo for a nice bonus.
Nothing says retirement fund stability like Bitcoin!
Guess I'll kiss my 401k savings goodbye as some AI junkie running the fund puts it into crypo for a nice bribe bonus.
I wonder if this is an edge case. All my employers have let me select everything usually a group of funds based on a target retirement date. I will need to pay more attention to ensure there is no...
I wonder if this is an edge case. All my employers have let me select everything usually a group of funds based on a target retirement date. I will need to pay more attention to ensure there is no crypto or PE being snuck in. I'm sure i can just email the broker and tell them to remove anything like that though.
Whelp, retirement accounts are going to be investing into memecoins and rug pulls. The financially illiterate being empowered to make bad decisions with their retirement funds is bad.
Whelp, retirement accounts are going to be investing into memecoins and rug pulls. The financially illiterate being empowered to make bad decisions with their retirement funds is bad.
[T]he paradigmatic way to save for retirement, in America in 2025, is a third, in-between option, the 401(k) plan. In this method, you don’t get a pension; your company doesn’t keep paying you a fixed amount after you retire. Instead, as in the second option, you put aside some money every year to invest. (And the company might put some extra money into your investments.) But, unlike in the second option, you can’t generally invest the money however you like; you can’t put it into sports gambling or your brother-in-law’s vending-machine business. Instead, your company gives you some menu of investing options, and you choose among them. And the company is a fiduciary and has a duty to give you a prudent menu of investment options. And if one of those options is “if you want we will take your 401(k) assets to Vegas and put them all on red,” and you choose that one and the ball lands on black and you lose all of your retirement savings, you will definitely sue your employer and you’ll definitely win. (Not legal advice.)
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But these days the main things that people talk about, when they talk about what should or shouldn’t be in your 401(k), are:
Private equity
Private credit and
Crypto.
And the essential question is not whether you should be allowed to invest in those things, but rather whether you should be able to sue your company for letting you invest in those things, if they lose money. Because the 401(k) system involves both individual investment choices and employer paternalism, and because you can sue your employer if it imprudently lets you invest in something that loses money, employers tend to offer only investment options that are clearly “prudent” under current norms. Index funds, in 2025, are clearly prudent. ESG funds, in 2025, are a little dicey. But what about privates and crypto? Are those prudent options for your employer to put on the 401(k) menu?
I mean the obvious answer is “last year they were not prudent, but the norms changed and now they are.” That’s not, like, a financial answer. It’s not that private equity and crypto were volatile and charged high fees in 2024, but now there have been structural changes such that they are safe and cheap. It’s that in 2024 the US federal government was pretty skeptical of crypto and of high-fee opaque investments in 401(k)s, and in 2025 a different federal government loves that stuff.
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Led by crypto and meme stocks and legalized sports gambling, the general norms about what sorts of investments regular people make, and should be allowed to make, and might enjoy making, have shifted. There is broader acceptance that of course you should be able to make all sorts of wild bets in your investment accounts, that a little excitement is a good feature of financial markets, that it is a good function of the financial system to offer you some entertaining bets. And if that’s true, then the 401(k) system is going to offer you some of those bets too.
By the way: You can still buy low-cost broad public stock index funds! You can do that in your individual brokerage account — it’s the button next to “Bet On Sports” — and you will probably be able to do it in your 401(k) for the foreseeable future. But your 401(k) plan might offer you a few additional, zanier options. And if you choose those and they don’t work out, that’s your problem.
I don't think we will see this have broad appeal for 401k plan administrators. Each plan’s sponsor and administrators decide whether to add private equity, crypto, or other alternatives to their...
I don't think we will see this have broad appeal for 401k plan administrators. Each plan’s sponsor and administrators decide whether to add private equity, crypto, or other alternatives to their fund menus. Most will weigh fiduciary liability, operational complexity, participant demand, and cost before offering them.
I have been bringing up SECURE 2.0 Act with my benefits team every chance I get. Link for more details. But the gist of it is that you are now legally allowed to have company do 401k matching when making student loan payments. But just like with this change, both the business and the plan admins have to opt in for it. My company has yet to do so.
Archive link.
In my experience private equity enshittifies everything it touches. This is terrible news.
Nothing says retirement fund stability like Bitcoin!
Guess I'll kiss my 401k savings goodbye as some AI junkie running the fund puts it into crypo for a nice
bribebonus.Can’t you decide where your 401k is invested? I’ve always been able to pick exactly the funds I hold.
My employer had their portion locked up in some managed lifecycle fund that I wasn't allowed to touch until seperation.
I wonder if this is an edge case. All my employers have let me select everything usually a group of funds based on a target retirement date. I will need to pay more attention to ensure there is no crypto or PE being snuck in. I'm sure i can just email the broker and tell them to remove anything like that though.
Whelp, retirement accounts are going to be investing into memecoins and rug pulls. The financially illiterate being empowered to make bad decisions with their retirement funds is bad.
Some of Matt Levine's commentary:
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I don't think we will see this have broad appeal for 401k plan administrators. Each plan’s sponsor and administrators decide whether to add private equity, crypto, or other alternatives to their fund menus. Most will weigh fiduciary liability, operational complexity, participant demand, and cost before offering them.
I have been bringing up SECURE 2.0 Act with my benefits team every chance I get. Link for more details. But the gist of it is that you are now legally allowed to have company do 401k matching when making student loan payments. But just like with this change, both the business and the plan admins have to opt in for it. My company has yet to do so.