Changes are coming soon for workers who invest in a 401(k).
The Biden administration has issued a new regulation that will allow 401(k) plan managers to offer investment options that take into consideration environment, social and governance issues, or ESG. The U.S. Labor Department's rule repeals regulations put in place during the Trump administration. Critics, like The Heartland Institute's Justin Haskins, say the move politicizes 401(k) investments. That's why he's urging investors to talk with their plan managers (or financial institutions) about their accounts.
“A lot of people just put their money in their 401(k) and they allow their plan managers or their employers to select a fund for them,” Haskins explained.
However, he says those who are opposed could ask their institution not to invest in ESG-related funds. The new rule takes effect in January.