Trump Wants Wall Street to Manage Your Retirement
Donald Trump is peddling a new plan that would steer Americans’ retirement dollars into Wall Street markets. Instead of shoring up the social safety net, financial experts warn that the White House is moving to privatize it.
Major brokerages stand to profit as Americans are pushed into private retirement accounts. (Kent Nishimura / AFP via Getty Images)
Amid a multimillion-dollar lobbying and campaign-finance blitz by major financial asset managers, President Donald Trump has introduced a new plan pushing Americans to invest their retirement dollars in Wall Street. Instead of shoring up the social safety net, financial experts warn that the White House is trying to privatize it — potentially at the expense of the country’s most vulnerable, who are increasingly exposed as the Trump administration takes a sledgehammer to other federal benefits.
And Charles Schwab, a GOP megadonor and founder of the brokerage firm of the same name, is now asking Congress to automatically enroll workers in this “generational boost to U.S. savings.”
One silver lining is that the exorbitant fees charged by rapacious private equity firms appear to have disqualified them from the plan.
An executive order issued by the president last week outlines a series of actions to help working-class Americans without access to employer-sponsored retirement plans invest in tax-advantaged, market-based individual retirement accounts (IRAs).
“The stock market has done so well, setting all those records — your 401(k)s are way up,” Trump said at his State of the Union address in January. “Yet, half of all working Americans still do not have access to a retirement plan with matching contributions from an employer.”
Like other Trump-branded White House efforts — like Trump Accounts for children and the Big Pharma directory website TrumpRx.gov — the administration will also launch TrumpIRA.gov, a website where any worker without an employer-sponsored plan can enroll in an eligible IRA.
The executive order also details the implementation of a Biden-era law, set to take effect at the beginning of next year, that will make a government-sponsored “Saver’s Match” available to twenty-two million low-income workers without a 401(k). Single taxpayers making up to $35,500 will be eligible for a 50 percent federal match on contributions to a qualified IRA, up to $1,000 a year.
To qualify for the Saver’s Match or appear on TrumpIRA.gov, IRAs must maintain “low administrative costs,” with net expenses capped at 0.15 percent and be “designed to protect principal on an ongoing basis,” as opposed to high-risk, growth-focused investments.
These standards effectively disqualify private equity from the new measures. On top of aggressive growth strategies that tend to prioritize liquidation and cost-cutting, private equity funds generally charge investors a 2 percent management fee plus an additional 20 percent fee on earnings over a certain threshold.
The decision to exclude high-risk private equity funds from Saver’s Match and TrumpIRA.gov comes as the Trump administration opens the door to private equity tapping into people’s 401(k)s, a long-awaited bailout for underperforming private funds.
The executive order “definitely rules out private equity. It looks like the Trump administration has Vanguard or something similar in mind,” Eileen Appelbaum, senior economist and codirector of the Center for Economic and Policy Research, told the Lever.
Privatizing Social Security
While Trump’s IRA order may have stopped short of letting private equity prey on more workers’ retirement funds, it will still channel workers’ savings into the private market, enriching Wall Street behemoths. This comes at a time when Social Security faces a funding shortfall in the next decade, in part because wealth inequality has left very little income actually eligible for the Social Security tax.
“If [Trump’s executive order] is embodied in legislation that passes, I am afraid it will be used to try to undermine Social Security,” Appelbaum said. “Republicans should use the government match funds to shore up Social Security and expand benefits for people below an income threshold.”
Consumer advocates and academics have long warned that privatizing the senior safety net could come at the expense of retirees, undermining consistent access to guaranteed benefits and putting their futures at the whim of the market. While opponents of Social Security argue that retirees would see higher returns on the market, research shows that added risk and higher administrative costs make these profits “illusory.”
Moreover, working-class Americans — particularly women and racial minorities — tend to be disadvantaged by investment-based retirement accounts because lower lifetime earnings equate to lower savings, as opposed to set benefits guaranteed by the government.
The Trump administration’s 2025 One Big Beautiful Bill Act provided seniors with a temporary deduction for taxes owed on Social Security, offering some relief to middle- and high-income households. But overall, the sweeping law will deplete tax revenues, accelerating Social Security’s insolvency.
And while Social Security beneficiaries next year are expected to receive another multipercentage-point increase in payments in what some are calling a “Trump bump,” these cost-of-living adjustments cover inflation and don’t represent a meaningful increase in benefits.
Amid a staff exodus last year, the Social Security Administration proposed — and then abandoned — a plan that could have disqualified hundreds of thousands of older Americans from disability benefits by limiting age as a factor for consideration.
Currently, the Trump administration is poised to cut Social Security benefits for as many as 400,000 individuals with disabilities, including those with Down syndrome and dementia, who live with relatives.
Separately, the Treasury Department has openly pitched new long-term market-based savings accounts for children — dubbed Trump Accounts — as “a backdoor for privatizing Social Security.” And this week, Sen. Ted Cruz (R-TX) offered a “dirty little secret” at a recent conference: “Trump Accounts are Social Security personal accounts.”
The Money Trail
For the asset management industry, government-backed IRAs are lucrative: they’re compounding, long-term investment vehicles with low turnover and a lifetime potential for fees. IRAs held roughly 23 percent of all US mutual fund assets in 2021, representing $6 trillion in investments.
It’s no wonder that Charles Schwab, founder of the brokerage of the same name, penned a Financial Times opinion piece this week encouraging Congress to pass legislation automatically enrolling eligible workers in approved IRAs, such as those managed by his firm. Schwab applauded “Trump’s generational boost to U.S. savings” — failing to mention that the $1,000 Saver’s Match program was passed under President Joe Biden.
Schwab the individual, and Schwab the firm, have donated hundreds of thousands of dollars to Republican PACs so far this year. That includes a combined $620,200 to the National Republican Senatorial Committee and the National Republican Congressional Committee as well as more than $10,000 to Sen. Majority Leader John Thune’s (R-SD) Heartland Values PAC.
Moreover, the Investment Company Institute, the leading trade group representing the asset management industry, has spent just under $1.3 million lobbying the federal government so far in 2026, including on “proposals to promote retirement savings through employer-sponsored plans and IRAs.” The firm’s PAC has also spent more than $1 million so far trying to influence the 2025–2026 election season, after spending $1.8 million last cycle, most of which went to Republicans.
The Securities Industry and Financial Markets Association, another asset management trade group, has spent $1.9 million lobbying the federal government in 2026, including on “issues relating to the preservation of [the] private sector retirement system.”
Meanwhile, the top three retail brokerages in the country — Fidelity, Charles Schwab, and Vanguard — helped wealthy megadonors anonymously funnel $171 million to sixty-eight right-wing nonprofits during the 2024 cycle, courtesy of shadowy charity vehicles called donor-advised funds. That includes $18 million directly to the Heritage Foundation, the author of Project 2025, the archconservative blueprint for Trump’s authoritarian second-term takeover.