Retirement Retirement Planning

401(k) Rules Are Changing Under Trump - And People May Not Like What's Happening

American workers need to know about these.

By Catherine Collins , Edited by Laura Hohenstein

Updated May 14, 2026

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Sometimes, changes in laws, tax policies, and even economic instability can affect 401(k) retirement plans directly or indirectly. During President Trump's first term, his administration made changes to taxes, fudiciary rules, and other regulatory requirements. These past rulings can give American workers a glimpse of some possible changes on the horizon.

Here are some of the 2026 updates to 401(k)s that have already taken place, along with some upcoming changes the Trump administration proposed. If you're an employee with a 401(k) plan, you need to know about these issues, especially if you plan on retiring in the next few years.

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2026 updated contribution limits

A positive change to 401(k)s that took place at the start of 2026 is that the IRS increased contribution limits. Now, workers can contribute up to $24,500 annually to their 401(k)s. Those who are above age 50 get an additional bump, as they are allowed to make $8,000 catch-up contributions in addition to the $24,500 maximum.

The catch-up contribution limit for age 60-63 remains unchanged from 2025. Those workers can contribute an extra $11,250 in 2026.

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Tax changes for high earners

If you make over $150,000 a year, there's another big change you should know about that impacts taxes. As of 2026, those making above this amount must put their catch-up contributions into a Roth account, rather than a traditional 401(k).

That means that high earners won't get to reduce their taxable income using 401(k) catch-up contributions as in previous years. However, there are some other benefits, like being able to withdraw Roth contributions tax-free in retirement (as long as you meet certain qualifications).

Alternative investments in 401(k)s

The Trump Administration has taken steps to encourage the inclusion of alternative investments, such as cryptocurrency, in 401(k) plans. While some policymakers and industry groups support expanding access to these assets, others — including Senator Elizabeth Warren — argue that cryptocurrency is too volatile and risky for retirement savings.

The debate has continued into 2026, with critics calling for stronger safeguards and clearer regulatory oversight to protect workers who rely on 401(k) plans to build long-term retirement security. A central concern is that many workers may invest in cryptocurrency through retirement accounts without fully understanding how volatile and speculative the assets can be.

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Changes in fiduciary rules and more deregulation

During the first Trump administration, President Trump issued orders promoting deregulation, which means they aimed to reduce red tape and compliance requirements in numerous areas. While these efforts didn't directly overhaul 401(k) plans, some critics argued they could indirectly affect retirement-plan oversight and fiduciary protections.

Because President Trump pursued these policies during his first term, some analysts expect 2026 could bring additional deregulation affecting retirement plans. The Brookings Institution maintains a lengthy tracking tool outlining regulatory changes made by presidential administrations, should you want to stay up to date on any proposed changes.

Market volatility

The market has experienced volatility during President Trump's second term, in part due to changing policies on tariffs. When policies change quickly, it can create uncertainty in the market, causing many workers to worry about dropping balances in their 401(k)s.

American workers could continue to see balance fluctuations in their 401(k)s in 2026, as many decisions regarding foreign policy and tariffs are still ongoing. If you're someone who gets anxious when your retirement balances fluctuate, it's a good idea to consult a financial advisor who can work with you on your retirement goals.

What isn't changing with 401(k)s

Even though there have been some proposed changes to 401(k)s, there are still aspects of contributing to these retirement plans that will remain the same. You will still receive tax advantages from contributing to a 401(k). Many employers across the country will continue to offer matching contributions.

Currently, 43% of Americans have 401(k)s, according to Fidelity. So, although seeing news about 401(k) updates might increase uncertainty, the plans themselves will remain available for the foreseeable future.

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How to stay informed and ask for help

The best way to stay up to date about 401(k) changes is to read every email your employer sends you about your 401(k) plan. If you have questions about plan updates, contribution rates, or your employer match, ask your Human Resources department.

If you're new to investing or want expert advice when choosing funds, it's always wise to work with a financial advisor and an accountant. These professionals can help ensure you're on track for retirement and maximizing your tax strategy.

Bottom line

The Trump Administration is considering some changes that could affect your 401(k) offerings, namely when it comes to the types of assets you can purchase within it. There have also been updates to contribution limits and tax rules for catch-up contributions in 2026. Staying up to date on these changes and asking a professional for help if you need it is the best way to ensure you're able to retire comfortably in the future.

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