Fri, 16 Jan 2026

Fri, 16 Jan 2026 Trump to unveil home buying plan involving retirement funds

The housing proposal will let Americans use their 401(k)s for down payments, a Trump economic adviser said.
The proposal, set to be announced at the Davos World Economic Forum next week, would let people withdraw money from 401(k) accounts to put towards a home purchase and then repay it with the equity of the home when sold. Employees who opt to withdraw money from retirement accounts typically incur fees and taxes. Trump's administration has been trying to address growing public pessimism about its handling of the economy, particularly on housing affordability which remains a major concern for Americans. The plan could help some people meet their current financial needs and better position themselves for retirement, but critics say it won't solve the housing affordability crisis. Low income workers are less likely to have access to 401(k) accounts, and analysts warn that draining these accounts could put people in a worse financial position if the home loses its value. Trump has recently announced other proposals aimed at addressing high housing costs, including a plan to ban big corporate investors from buying single-family homes. A separate proposal to buy $200bn worth of mortgage bonds by government-backed housing finance firms Fannie Mae and Freddie Mac is intended to push down mortgage rates. However, housing economists have expressed concerns that the bond purchases might not lead to substantial long-term reductions in mortgage rates. The US central bank's benchmark interest rate can indirectly affect mortgage rates, but some analysts question whether the Fed will cut its own rates in response to Trump's proposal.
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