Buffalo, N.Y. (WBEN) - How should you handle possible changes to the types of investments allowed in your 401(k) plan?
A recent Executive Order signed by President Trump asks the Labor Department and others to determine what changes need to be made to allow certain types of "alternative" assets like crypto, private real estate, and private equity inside of 401(k) retirement plans.
"Last week, President Trump signed an Executive Order that would actually pave the way for some of these risky assets to be included in 401(k) plans," said Jill on Money host Jill Schlesinger on WBEN. "The question really becomes: If you have a retirement account, how much should you, if at all, put it into something really risky?"
So, what's the answer?
"Let's say that you have all of your ducks in a row," Schlesinger said. "You've got your emergency fund, you've got your debt paid down, and you're putting money in your retirement account, and your retirement account is really the only investment you have. Why not limit your 'fun' part of your portfolio to 5-10%. That's it. So if you have $100,000 in a retirement account and you said 'I'll put $5,000 in Bitcoin,' I don't have a huge problem with that."
"But don't cry when it goes down."
For most people, Schlesinger said the the fundamentals remain: contribute consistently, diversify, and let compound interest fuel your returns.