Your 401(k) has looked roughly the same for decades: a menu of mutual funds, a handful of index options, and maybe a target-date fund that adjusts as you age. That familiar setup could soon change in ways that touch every dollar you save for retirement.
T. Rowe Price, which oversees roughly $1.83 trillion in client assets and counts about two-thirds of that total as retirement money, laid out a blueprint for what comes next during its annual 2026 U.S. Retirement Market Outlook briefing.
The firm’s experts identified four converging forces carrying direct consequences for the tens of millions of people contributing to workplace plans.
If you have money in a 401(k), these developments could change what you can invest in, how your plan communicates with you, and the type of financial guidance you receive.
T. Rowe Price outlines how private assets could enter 401(k) plans
The most tangible shift involves opening retirement accounts to investment categories historically reserved for institutional investors and the ultra-wealthy.
Private equity, private credit, real estate, and infrastructure could soon appear inside the diversified funds your employer offers, the firm’s outlook indicated.
Private market assets have expanded at nearly three times the rate of their publicly traded counterparts over the past 15 years, Jessica Sclafani, global retirement strategist at T. Rowe Price, explained during the briefing.
More Personal Finance:
- Fidelity has a warning for anyone who left a 401(k) at an old job
- Living trusts: what they do and who needs one
- Fidelity sounds alarm on 401(k)s, IRAs
The firm’s research argues that professionally managed multi-asset solutions, like target-date funds, are the right vehicle for delivering that exposure to defined-contribution plan participants.
Sclafani cautioned that inclusion alone is not enough. “Any private asset allocation must earn its place in the portfolio by offering unique net-of-fee investment benefits,” she said.
Alternative investments typically carry higher fees and less liquidity than the mutual funds dominating current 401(k) plans, so any addition would need to demonstrate clear value after costs.
Federal rulemaking paves way for alternative 401(k) investments
The regulatory process behind this shift began in August 2025, when President Donald Trump signed an executive order directing the Department of Labor to reexamine past guidance on alternative assets within retirement plans and issue clarifying rules.
The Department of Labor responded on March 30, 2026, with a proposed rule creating a process-based safe harbor for fiduciaries who add alternative investments to 401(k) lineups.
The safe harbor requires fiduciaries to objectively consider six factors: performance, fees, liquidity, valuation, performance benchmarks, and complexity, according to the DOL.
The DOL’s proposed regulation could affect retirement investment options for more than 90 million Americans, according to the agency’s release.
Defined-contribution plans collectively hold more than $12 trillion in capital, a Cleary Gottlieb analysis of the executive order confirmed.
That scale means even modest shifts in allowable investments could reshape the entire retirement savings landscape.
Aliya Robinson, T. Rowe Price’s director of congressional affairs, said at the briefing that a final rule could be issued before year-end, with implementation beginning in 2027. “This is definitely on a fast track,” Robinson said.
New federal rules could open 401(k)s to alternative investments, potentially reshaping retirement portfolios for more than 90 million Americans.
monkeybusinessimages/Getty Images
Artificial intelligence projected to save retirement industry billions
The technology powering retirement plan administration is also changing. Brandon Shea, defined contribution strategist at the firm, described a shift in which artificial intelligence is moving from an experimental concept to a practical business tool within the retirement ecosystem.
Consulting firm Everest Group has estimated that AI could save the United States retirement and pension industry between $16 billion and $20 billion in operational costs, the outlook noted.
“We’re entering a new era where AI can materially improve how advice is delivered, how plans are run, and how participants engage,” Shea said, emphasizing that the goal is to equip human advisors with better tools rather than replace them.
Personalized retirement guidance becomes a baseline expectation
The fourth trend centers on demand for individualized financial advice delivered through workplace plans.
“In 2026, advice and personalization are becoming foundational expectations rather than optional enhancements,” Rachel Weker, retirement strategist at the firm, said.
She pointed to increasingly complex participant finances, scalable technology, and growing employer appetite to support workers beyond just the saving phase.
What this 401(k) overhaul means for everyday retirement savers
These trends suggest a 401(k) experience that could look meaningfully different over the next few years.
Investment menus may broaden to include asset classes that once required seven-figure minimums, and the guidance participants receive may become more tailored to individual circumstances.
The U.S. retirement system is at a pivotal moment — shaped by evolving regulation, rapid technological change, and a renewed focus on how to best meet the diverse needs of plan participants.
Alternative investments introduce complexities around fees, valuation, and liquidity that traditional mutual fund lineups do not present, and the transparency workers have grown accustomed to may not fully apply to portfolios holding private assets.
The convergence of new regulations, technology adoption, and product innovation creates both opportunities and challenges for the industry, the outlook concluded.
T. Rowe Price’s outlook suggests the next 12 to 18 months could reshape the 401(k) experience for the more than 90 million Americans in defined-contribution plans.