STEPHEN MOORE: There’s A Reason Trial Lawyers Are Blocking People From A Wealth Retirement Plan That Lifts More Boats

TheBernie Sanders andElizabeth Warrens of the world have long complained about how the rules in Washington and on Wall Street are rigged in favor of the rich.

Well there is one federal policy that absolutely does benefit those with higher incomes over working class Americans.

The wealthy have long hadalmost monopolyaccess to the most lucrative investmentopportunities,includingprivate equity, private credit, crypto assets, and real estate investment trusts.  These assets have been legally closed off to the middle class and lower income retirement accountsas “too risky.”This has enabled higher income Americans and “accredited investors” to earn higher returns on their money.

As the table below shows,from 2003 to 2023, the returns on these alternative investment vehicles have outperformed traditional “safe” 401k investments:

Annual Rate of Return on Capital Market Investments,  2013-23

Private Equity                          15%

Public Equity (stocks)            10%

Real Estate                                10%

Bonds                                           2%

Total 401k Average Returns     8%

Source: American Investment Council, 2024.

That gap is costing retirees tens of thousands of dollars or more of lost retirement income.