By The Craig Bushon Show Media Team
August, 9th 2025
President Trump’s executive order to “Democratize Access to Alternative Assets” in 401(k) plans has been pitched as a big win for working Americans. For the first time, your retirement account could hold not just stocks and bonds—but real estate investments once reserved for Wall Street firms, wealthy families, and private funds.
On the surface, this sounds like a game-changer. Real estate is tangible, it’s historically a hedge against inflation, and it’s an asset class that’s helped build generational wealth for decades. But like any deal that sounds too good to be true, the devil is in the details.
The Potential Upside for Main Street Investors
1. Access to Commercial Real Estate (CRE)
Today, most 401(k) participants only get a slice of real estate through REIT (Real Estate Investment Trust) mutual funds—basically a proxy for public real estate stocks. Under the new rules, plan providers could offer direct or fund-based exposure to private commercial properties—office buildings, industrial parks, apartment complexes—often through institutional-grade funds.
2. Inflation Protection
Unlike a bond paying fixed interest, real estate rents can rise over time, giving these investments some built-in inflation resistance. For a retiree worried about the dollar’s shrinking power, that’s appealing.
3. Diversification Beyond Wall Street Volatility
When the stock market takes a dive, high-quality real estate often holds value better. For conservative savers, adding real estate to a portfolio could be a stabilizing force—if chosen wisely.
The Hidden Risks Washington Isn’t Talking About
1. Liquidity Lock-Ups
You can sell a stock with a click. You can’t unload your share in an office park or private rental portfolio overnight. Many private real estate funds lock investor money up for 5–10 years, meaning if you need cash during a downturn, you might be stuck.
2. Fees and Commissions
Private real estate funds can charge 1%–2% in annual management fees plus profit-sharing. Over decades, these costs eat into returns—and they’re often buried deep in offering documents the average worker won’t read.
3. Valuation Smoke and Mirrors
Private real estate isn’t priced daily like the S&P 500. Fund managers have flexibility in marking asset values, which can mask losses until it’s too late—especially in a falling property market.
4. Sector Risks
Ask anyone who owned office buildings during the COVID-era remote-work boom: not all real estate is created equal. A downturn in a particular sector—like retail malls in the Amazon era—can crater returns.
What This Means for 401(k) Savers
For everyday Americans, this change means you could soon see options in your retirement plan like private real estate funds investing in multi-family housing, industrial properties, or medical office buildings; real estate debt funds that lend to developers and earn interest payments; and specialized REIT alternatives targeting niche sectors like senior living or storage facilities.
The idea is to level the playing field with pension funds and endowments that have long used these strategies. But here’s the catch: those institutions employ teams of analysts to vet deals—most individual savers don’t.
Historical Lessons
The 2008 financial crisis is a cautionary tale. Many retirement accounts loaded up on REITs and private real estate investments in the mid-2000s, chasing the boom. When the housing market collapsed, some REITs lost more than 60% of their value, and private real estate funds froze redemptions, locking investors in as property values plunged. The lesson is simple: real estate can be a powerful tool, but leverage, illiquidity, and overexposure can wipe out years of gains almost overnight.
The Craig Bushon Show Take
This policy can be a positive for Americans if it’s paired with strong fiduciary oversight, low-fee offerings, and clear disclosure. Without those safeguards, it risks turning retirement accounts into fee-generating machines for Wall Street, with workers shouldering the downside.
Real estate can be a powerful wealth-builder, but in the 401(k) context, it’s no slam dunk. This new access could either open doors to generational wealth—or invite a new wave of retirement horror stories if savers are pushed into high-risk, high-fee deals they don’t fully understand.
In short: the promise is real, but so is the peril. The smart investor will demand transparency, low costs, and a clear exit strategy before handing over a penny.
This article is opinion commentary from The Craig Bushon Show media team. It is not intended as financial advice. Readers should conduct their own research or consult with a licensed financial advisor before making any investment decisions.
