What happened: President Donald Trump’s new Executive Order on 401(k)s will help ensure that Americans who work for businesses of all sizes have access to a variety of investment options, while at the same time protecting small businesses and retirement savers from frivolous lawsuits. 

Tell me more: Small businesses are currently allowed to offer private market investments to their employees as a part of 401(k) plans, but the threat of lawsuit abuse has deterred employers from offering these investment options. 

• According to the U.S. Chamber of Commerce’s Institute for Legal Reform, litigation costs in 2021 “totaled $347 billion,” with small businesses bearing about 50 percent of that cost, even though they only account for 20 percent of business revenue.

TLR Thoughts: President Trump’s newly announced Executive Order on 401(k)s recognizes the burden that frivolous lawsuits place on small businesses in particular—ultimately impacting hardworking Americans. Limiting unnecessary litigation strengthens America’s economy and helps more Americans build wealth, showing that legal reform can have immediate, measurable impacts on both business growth and retirement security.

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