White House: Opening 401(k)s to Private Markets Could Boost GDP by $35B

The White House Council of Economic Advisers estimates that allowing 401(k) holders to invest in private equity could generate $35 billion in annual GDP growth.

According to an August 2025 CEA report, shifting roughly 20% of retirement assets toward private markets would drive that gain. With 401(k) plans holding an estimated $10.5 trillion as of 2023, even a small reallocation would funnel enormous capital into private equity, private credit, and crypto.

President Trump signed an executive order on August 7, 2025, encouraging expanded access to alternative assets. The Department of Labor followed on March 30, 2026, with a proposed rule creating a “safe harbor” for plan fiduciaries who include such assets, provided they follow specific risk-assessment guidelines.

Critics, including the Economic Policy Institute, warn that private markets are illiquid, volatile, and complex. Retirees needing predictable withdrawals could face lock-up periods of years.

Even if approved, employers are not rushing in. The safe harbor rule is permissive, not mandatory.

Private equity firms like Blackstone, KKR, and Apollo are building retail products in anticipation of this shift.