Stop imagining how US pensions work and listen to the experts on adding cryptocurrency to your 401(k)Recommended Article | Bee Network

Stop imagining how US pensions work and listen to the experts on adding cryptocurrency to your 401(k)Recommended Article | Bee Network Login ट्रेंडिंग न्यूज़ मीम लॉन्चपैड एआई एजेंट डेस्सी टॉपचेनएक्सप्लोरर न्यूबी के लिए 100x सिक्के मधुमक्खी खेल आवश्यक वेबसाइटें एपीपी अवश्य होना चाहिए क्रिप्टो हस्तियाँ डेपिन नौसिखिया आवश्यक ट्रैप डिटेक्टर बुनियादी उपकरण उन्नत वेबसाइटें एक्सचेंजों एनएफटी उपकरण नमस्ते, साइन आउट वेब3 यूनिवर्स खेल डीऐप मधुमुखी का छत्ता बढ़ता हुआ मंच विज्ञापन खोज अंग्रेज़ी रिचार्ज सिक्के लॉग इन करें डाउनलोड करना वेब3 यूनी खेल डीऐप मधुमुखी का छत्ता विज्ञापन घर•विश्लेषण•Stop imagining how US pensions work and listen to the experts on adding cryptocurrency to your 401(k)Recommended Article Stop imagining how US pensions work and listen to the experts on adding cryptocurrency to your 401(k)Recommended Articleविश्लेषण7 महीने पहलेहाँव्याट 24,670 55 Matt Levine is a Bloomberg Opinion columnist covering finance, consistently ranking as the most read columnist on Bloomberg Finance. He was formerly the editor of Dealbreakers and has worked in investment banking at Goldman Sachs, as an M&A lawyer at Wachtell, Lipton, Rosen & Katz, and as an associate judge on the U.S. Court of Appeals for the Third Circuit.

401(k) plans The traditional approach to retirement savings works like this: You work for a company for decades, receiving a salary. When you retire, the company continues to provide you with a pension. The company is obligated to pay you a fixed monthly amount. To fulfill this obligation, it saves and invests the money to ensure it has enough to cover your retirement. If the investments are profitable, the company has extra funds to keep; if they lose money, the company has to pay out of pocket to cover the amount owed to you. This situation is bad for the company (it has to pay extra) and bad for you, as it exposes you to credit risk. A US law called ERISA (the Employee Retirement Income Security Act) requires companies to manage their pension funds prudently. As trustees for retired employees, they cannot afford to lose the money.

Another way to save for retirement is to work for a company for decades, receiving a salary. You save and invest a portion of your salary. After retirement, the company doesn’t provide a pension—you don’t get one—and you rely entirely on your investments to live. If your investments are successful, you’ll have enough to spend and some to spare. If your investments go badly, the lack of funds is your responsibility, not your employer’s. If you’re so inclined, you could even invest everything in meme stocks or sports betting, taking a gamble—though the results could be disastrous.

But in the United States in 2025, the most popular retirement savings method is the third one—the 401(k) plan, which is somewhere between the first two. In this method, you don’t have a pension, and your company won’t give you a fixed salary after retirement. Like the second method, you have to save money and invest it yourself every year (the company may subsidize your investment). But unlike the second method, you can’t invest your money arbitrarily, such as in sports betting or your brother-in-law’s vending machine business. The company will give you a menu of investment options, and you can only choose from them. [1] As a fiduciary, the company has an obligation to provide you with reasonable and prudent investment options. If there is an option on the menu that says “We take your 401(k) assets to Las Vegas and bet all on red,” and you choose this option, and the ball lands on black, your retirement savings will be gone, and you can definitely win your lawsuit against your employer. (This is not legal advice.)

In other words: individuals are responsible for their own retirement savings, but not solely. Employers have a certain fiduciary obligation to मार्गदर्शक their employees’ investments and not let them arbitrarily decide. This also falls under the purview of ERISA, which seems to be a bit of a coincidence. In the past, companies provided pensions and had to manage them carefully, which led to the accumulation of expertise in retirement investing. Today, retirement savings require individual employees to make investment decisions, but companies still possess this expertise. Individual employees, on the other hand, sometimes prefer to take a gamble. Therefore, companies need to play a parental role, guiding employees’ investment decisions and preventing them from losing all their money. If companies fail to fulfill this role conscientiously, they can be sued.

The key here is “suability.” The standards for what constitutes prudent investments and what is acceptable in 401(k) plans have been constantly evolving. In the 19th century—before 401(k) plans or ERISA—courts sometimes held that investing in common stocks (as opposed to government bonds or mortgages) was imprudent, exposing trustees to potential lawsuits. When index funds were first introduced in the 1970s, some employers were hesitant, fearing that investing in all stocks without conducting due diligence on each one would breach their fiduciary duties.

By 2015, I wrote that “regulatory opinion was converging”—particularly within the U.S. Department of Labor, which is responsible for ERISA—that “index funds are good and should be encouraged; active management is bad and should be discouraged.” The logic was:

Actively managed stock funds typically don’t outperform the index and have much higher fees than index funds, so buying an index fund may be more prudent than hiring an active manager.

This view isn’t universally shared. While actively managed mutual funds are still often offered in company 401(k) plans, there is pressure to offer index funds, and even greater pressure to control fees. Everyone knows that investing carries risk, and it’s not necessarily the employer’s fault if a fund on the 401(k) menu loses money. However, if a fund on the menu charges twice as much as another nearly identical fund, it certainly appears imprudent and could lead to legal action.

ESG investing (environmental, social, and governance investing) has recently become a focal point of controversy within 401(k) plans. In January, we reported on how American Airlines Group ran into trouble over ESG issues within its 401(k) plan. American Airlines didn’t even offer ESG funds in its 401(k) plan—just regular, low-cost index funds—but those funds were managed by BlackRock, a company that has frequently discussed ESG. A Texas judge ruled that using employee funds for ESG investments was imprudent.

When people discuss what to put in a 401(k) plan and what not to put in it, the main focus is on:

Private equity, private credit and क्रिप्टोमुद्राएँ.

The core issue isn’t whether you should be allowed to invest in these things, but whether you can sue your company if you lose money investing in them. Because the 401(k) system combines individual investment choices with the paternalistic management of the employer, and because you can sue your employer if they imprudently allow you to invest in something that loses money, employers tend to only offer investment options that are clearly “prudent” under current standards. In 2025, index funds will clearly be considered prudent. ESG funds are a bit more ambiguous in 2025. But what about private equity and cryptocurrencies? Is it prudent for employers to include these in 401(k)s?

The obvious answer is, “It wasn’t prudent last year, but the standards have changed, and now it’s prudent.” This isn’t a financial answer. It’s not that private equity and cryptocurrencies were volatile and expensive in 2024, and suddenly a structural shift has made them safe and cheap. It’s that in 2024, the US federal government was skeptical of cryptocurrencies and high-fee, opaque investments in 401(k)s, and in 2025, a new administration came to love them. Now, this shift is becoming official policy:

President Trump signed an executive order on Thursday allowing private equity, real estate, cryptocurrencies and other alternative assets into 401(k) plans, a major victory for industries hoping to grab a piece of the estimated $12.5 trillion in retirement accounts.

According to people familiar with the matter, the order will direct the Department of Labor to reevaluate its guidance on alternative asset investments in retirement plans governed by the Employee Retirement Income Security Act of 1974. The Department of Labor will also need to clarify the government’s position on the fiduciary duties associated with offering asset allocation funds that include alternative assets…

Washington officials have been considering the directive for months, aiming to alleviate legal concerns that have long prevented alternative assets from entering most employee defined contribution plans. Retirement portfolios are heavily weighted toward stocks and bonds, in part because corporate plan managers are reluctant to take the risk of investing in illiquid, complex products…

Alternative and traditional asset managers are eager to capture a slice of the defined contribution market, which they see as the next frontier for growth. Many institutional investors, such as U.S. pension funds and university endowments, have reached internal ceilings on their investments in private equity amid slowing trading and a lack of allocations to clients.

From a fundamental perspective, putting illiquid private assets in a 401(k) makes sense: the core idea of a 401(k) is to keep your money in until retirement, so you don’t need liquidity, and if there’s a premium on illiquid assets, you should earn it. Furthermore, the private markets are the new public markets: as Byrne Hobart points out, “Private equity plus public-market owned companies look a lot like the companies that would have gone public 30 years ago.” So if owning stocks in a 401(k) is prudent, then owning private equity makes sense, too.

On a deeper level, the idea that “the financial industry wants to sell to individual investors because it can’t sell to institutions and the fees are too high” is simply the worst possible advertising for investment products. When the savviest asset management firms are eager to sell you something, you should consider whether you should buy it. Of course, this isn’t investment advice. When cryptocurrency management firms are eager to sell you something, it could also be a sign of something.

That said, I’m not sure how much this is a story about the rise of private assets (and crypto) and how much it’s a story about the decline of 401(k) paternalism. The bottom line is that Americans now have far more and more exciting investment options outside of their 401(k)s than they did a few years ago. You could buy stocks before, and now you can buy meme stocks, which is even more absurd. You can buy intraday options. You can do all kinds of private lending. You can buy 10x leveraged perpetual cryptocurrency futures on Coinbase. You can even, and I can’t stress this enough, bet on sports from your brokerage account. You can’t buy tokenized shares of OpenAI yet, but give it a month.

Driven by cryptocurrencies, meme stocks, and legal sports betting, the prevailing view of what ordinary people should invest in, should be allowed to invest in, and might enjoy investing has shifted. It’s become more widely accepted that you should be able to make all sorts of crazy bets in your investment account. A little excitement is a good feature of financial markets, and providing you with some entertaining bets is a good function of the financial system. If that’s the case, then your 401(k) system will also offer you some of those bets.

By the way: You can still buy low-cost broad public stock index funds! You can buy them in your brokerage account—right next to the “sports betting” button—and for the foreseeable future, you’ll also be able to buy them in your 401(k). But your 401(k) probably offers some additional, wilder options. If you choose them and they don’t work out, that’s your fault.

यह लेख इंटरनेट से लिया गया है: Stop imagining how US pensions work and listen to the experts on adding cryptocurrency to your 401(k)Recommended Articles

Related: 2025 Perp DEX Status: Strong Development Momentum, Transaction Volume Soaring

Original author: Launchy Original translation: TechFlow Perpetual DEXs have rapidly evolved from being experimental DeFi tools to becoming a major player in the crypto derivatives market. In 2024, this sector has seen explosive growth, with total trading volume across Perp DEXs reaching $1.5 trillion, more than doubling from $647.6 billion in 2023. Trading volume in December alone reached $344.75 billion, setting a new monthly high. Data source: CoinGecko This surge is mainly due to platforms like Hyperliquid, whose annual trading volume soared from $21 billion in 2023 to $570 billion in 2024, a 25.3-fold increase. Drift and Jupiter also achieved significant breakthroughs, with annual trading volumes increasing by 628% and 5176% year-on-year, respectively. With the emergence of innovations like native order books, fast-finality chains, zk-enabled features, and app-specific ecosystems, 2025…

 

# विश्लेषण# क्रिप्टो# डेफी# गाइड# मार्केट# टोकन© 版权声明सरणी 上一篇 How far are we from a full-blown copycat season?Recommended Articles 下一篇 After a 10-fold stock surge, Circle's first financial report highlights both the bright spots and the hidden concerns.Re 相关文章 Say goodbye to the flood of money, has the “blind buying” counterfeit season become history? 6086cf14eb90bc67ca4fc62b 18,514 1 Behind 27,000 Transactions: The Survival Algorithm and Illusion of High Win Rates of Polymarket Whales 6086cf14eb90bc67ca4fc62b 12,081 1 Goldman Sachs Casts a Vote of Confidence in ETH: The Biggest Detail in Its $2.3 Billion Holdings Isn’t BTC 6086cf14eb90bc67ca4fc62b 8,496 18 Cutting Through the Noise of Ethereum’s “Degeneration”: Why Are “Ethereum Values” Its Widest Moat? 6086cf14eb90bc67ca4fc62b 11,082 1 24 घंटे की ताज़ा खबरें और ट्रेंडिंग कॉइन | ट्रंप ने फेडरल रिजर्व के गवर्नर कुक को पद से हटाया; बायो लॉन्चपैड का पहला प्रोजेक्ट, ऑब्रई, लॉन्च हुआ (0826) 6086cf14eb90bc67ca4fc62b 22,053 2 MegaETH’s public offering starts tonight. Can it replicate XPL’s wealth-making miracle? 6086cf14eb90bc67ca4fc62b 15,183 कोई टिप्पणी नहीं टिप्पणी करने के लिए आपको लॉगिन होना होगा! तुरंत लॉगइन करें कोई टिप्पणी नहीं... नवीनतम लेख Did Jane Street “Manipulate” BTC? Decoding the AP System, Understanding the Power Struggle Behind ETF Creation and Redemption Pricing 21 घंटे पहले 651 Stop Comparing Bitcoin to Gold—It’s Now a High-Volatility Software Stock 21 घंटे पहले 706 Matrixport Research: $25 Billion Gamma Unwinding Imminent, Liquidity Yet to Return Behind the Rebound 21 घंटे पहले 657 ERC-5564: Ethereum’s Stealth Era Has Arrived, Receiving Addresses No Longer ‘Exposed’ 21 घंटे पहले 547 Hong Kong Regulatory Green Light: Asseto Enables DL Holdings to Achieve Compliance for Two RWA Business Implementations 21 घंटे पहले 627 लोकप्रिय वेबसाइटेंTempoLighterजीएआईबीग्लाइडरप्लांकरेल्सबीसीपोकरवूई Bee.com दुनिया का सबसे बड़ा Web3 पोर्टल भागीदारों कॉइनकार्प बिनेंस कॉइनमार्केटकैप कॉइनगेको कॉइनलाइव कवच बी नेटवर्क ऐप डाउनलोड करें और वेब3 यात्रा शुरू करें सफेद कागज भूमिकाएँ सामान्य प्रश्न © 2021-2026. सर्वाधिकार सुरक्षित।. गोपनीयता नीति | सेवाओं की शर्तें बी नेटवर्क ऐप डाउनलोड करें और वेब3 यात्रा शुरू करें दुनिया का सबसे बड़ा Web3 पोर्टल भागीदारों CoinCarp Binance CoinMarketCap CoinGecko Coinlive Armors सफेद कागज भूमिकाएँ सामान्य प्रश्न © 2021-2026. सर्वाधिकार सुरक्षित।. गोपनीयता नीति | सेवाओं की शर्तें खोज खोजइनसाइटऑनचेनसामाजिकसमाचार उत्तर: एयरड्रॉप शिकारी डेटा विश्लेषण क्रिप्टो हस्तियाँ ट्रैप डिटेक्टर हिन्दी English 繁體中文 简体中文 日本語 Tiếng Việt العربية 한국어 Bahasa Indonesia اردو Русский हिन्दी