Chelsea Ransom-Cooper, CFP® and Co-Founder and Chief Financial Planning Officer at Zenith Wealth Partners, shared her expert perspective in this Advisor Perspectives article examining the implications of President Trump’s executive order opening the door for alternative investments, including private equity, real estate, and digital assets, in 401(k) plans.
While Chelsea acknowledges the intention to democratize access to alternative investments, she urges retirement savers to proceed with caution, noting, “I think there should be some pause as people may sign up for things they are unfamiliar with, and it could be a risk to their retirement portfolios.” She breaks down key concerns around private equity specifically, including its illiquid nature, the complexities of job changes and account rollovers, and the often-costly “2 and 20” fee structure that may not serve the average American retirement investor.
Chelsea also outlines the shared responsibility among plan sponsors, administrators, and investment advisers in determining whether alternative funds are appropriate for their plans, and encourages individuals to connect with their own financial advisor to evaluate what makes sense for their unique situation. Her insights offer retirement savers and industry professionals alike a grounded, fiduciary-focused framework for navigating this significant shift in retirement plan policy.