New Rule Expands Private Equity Access to 401(k) Retirement Savings

Critics warn move could expose workers to higher fees, lower returns, and opaque risks

Mar. 31, 2026 at 6:05am

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The Trump administration has proposed a new rule that would expand private equity and private credit firms' access to 401(k) retirement plans, a move that critics say could put workers' savings at risk. The rule creates a regulatory 'safe harbor' that shields 401(k) fiduciaries from liability, even if they steer workers into complex private market investments. The Private Equity Stakeholder Project warns this could make it harder for workers to challenge risky or illiquid investments or the high fees charged by private asset managers.

Why it matters

This policy shift could weaken long-standing fiduciary protections for retirement savers while benefiting Wall Street firms. Private equity and private credit investments are often illiquid and can restrict withdrawals during periods of stress, which could put workers' retirement security at risk.

The details

The new rule creates a safe harbor that shields 401(k) fiduciaries from liability, even if those decisions steer workers into complex private market investments. In practice, this could make it harder for workers to challenge risky or illiquid investments or the high fees that private asset managers charge. Recent headlines about private credit managers restricting withdrawals have highlighted the liquidity risks of these investments.

  • The Trump White House proposed the rule on March 31, 2026.
  • Last year, a record 6 percent of workers in Vanguard-administered 401(k) plans took hardship withdrawals.

The players

Private Equity Stakeholder Project (PESP)

A non-profit organization that advocates for transparency and accountability in the private equity industry.

Jim Baker

Executive Director of the Private Equity Stakeholder Project.

Joshua Harris

Co-founder of private equity and credit giant Apollo Global Management.

Harvey Schwartz

CEO of private equity firm Carlyle Group.

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What they’re saying

“Private equity firms should not get a free pass to loot workers' 401K retirement savings; PESP opposes any safe harbor that would weaken fiduciary protections for retirement savers.”

— Jim Baker, Executive Director, Private Equity Stakeholder Project

“my own view is that it's not going to end well.”

— Joshua Harris, Co-founder, Apollo Global Management

“some private capital funds might more accurately be described as 'sometimes not liquid at all'.”

— Harvey Schwartz, CEO, Carlyle Group

What’s next

The Department of Labor is expected to finalize the rule in the coming months, which could face legal challenges from consumer advocates.

The takeaway

This rule change risks shifting more financial risk onto workers who rely on their 401(k) savings for long-term retirement security, exposing them to higher fees, lower returns, and opaque risks from private equity and private credit investments.