Retirement Retirement Planning

401(k) Rules Could Change Under Trump - And People May Not Like What’s Coming

American workers need to know about these.

By Catherine Collins

Edited by Laura Hohenstein

Updated Jan. 30, 2026

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 in 2026.

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.

Get a protection plan on all your appliances

Did you know if your air conditioner stops working, your homeowner’s insurance won’t cover it? Same with plumbing, electrical issues, appliances, and more.

Whether or not you’re a new homeowner, a home warranty from Choice Home Warranty could pick up the slack where insurance falls short and protect you against surprise expenses. If a covered system in your home breaks, you can call their hotline 24/7 to get it repaired.

For a limited time, you can get your first month free with a Single Payment home warranty plan.

Get a free quote

2026 updated contribution limits

A positive change to 401(k)s in 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.

Who really has the cheapest auto insurance in your area? Check your zip code here.

Tax changes for high earners

If you make over $150,000 a year, there's another big change you should know about that will impact your 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 introduced the idea of including alternative investments, such as cryptocurrency, in 401(k) plans. Though some in Washington are in favor of this, others, including Senator Elizabeth Warren, argue that cryptocurrency is too volatile an asset to allow in secure retirement funds.

This debate is currently underway in 2026, with Senator Warren requesting a response from the SEC outlining what safeguards the agency will include to protect American workers who rely on 401(k)s to build their retirement plans. The primary concern is that 401(k) assets can be complex, and many workers might select cryptocurrency as a retirement investment without realizing how volatile it can be.

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 issues in numerous areas. While this didn't affect 401(k) plans directly, it impacted workers indirectly. That's because 401(k) plans with fewer fiduciary rules mean that 401(k) plan administrators have fewer restrictions.

Because President Trump issued these orders during his first term, 2026 could bring more deregulation in retirement plans. The Brookings Institute maintains a lengthy tracking tool outlining all regulatory changes the Trump administration makes, 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, namely due to changing policies on tariffs. When policies change quicky, it creates uncertainty in the market, causing many workers to worry about dropping balances in their 401(k)s.

American workers will likely 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.

Grow Your $$: 11 brilliant ways to build wealth after 40

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.

More from FinanceBuzz: