"Private equity firms and other alternative asset managers ... are reshaping the once-staid world of life insurance.... Many are shifting liabilities to offshore affiliates subject to less detailed disclosure requirements than in the US. Insurers and those offshore entities are also pursuing higher returns with more sophisticated and potentially less liquid investments ... [P]rivate equity-affiliated life insurers are already shepherding retirement savings into those same opaque markets -- including for people who say they don't want that." MORE >>
"[The] study took a large number of real-life investors from Morningstar's Retirement Manager database and ran them through a simulated retirement experience, including factors such as company matches, contribution limits, and most importantly, Social Security payments. In all cases, ... the presence of at least one private markets investment made at least a small contribution to the investor's retirement income. Notably, [there were] no outcomes in which the inclusion of semiliquid vehicles resulted in worse outcomes." MORE >>
"Most adults do not think it's important to have the ability to invest in private market investments (61%) ... within their workplace retirement savings account.... Interest in investing in private market investments declines sharply when people learn about fees, liquidity, transparency and risk -- three in five are not at all interested, and another quarter only slightly interested.... Most Americans are uncomfortable with being automatically enrolled in funds in their workplace retirement savings accounts that include private market investments (68%) ... This resistance is particularly strong among older adults." MORE >>
"According to recent data, the top 10 companies in the S&P 500 now account for nearly 40% of that index's total market capitalization. That level of concentration means that even broadly diversified index funds may be more exposed to sector-specific risks than many investors realize. In such an environment, the case for expanding the investment universe to include exposure to alternative investments becomes even more compelling." MORE >>
"Unlike publicly traded funds, data about alternative investment funds is not always readily available nor easy to interpret.... Financial advisors can help retirement plan participants navigate the brave new world of customized alternatives by doing a deep dive into what's available and how they compare with traditional bonds, cash, and stock. This is easier said than done. New products won't have a long track record. Performance metrics will differ." MORE >>
"This report expands and fully develops the legal, economic, regulatory, and fiduciary basis demonstrating that any allocation to Private Equity (PE) or Private Credit (PC) within a 401(k) Target Date Fund (TDF) -- including allocations as small as 1-10% -- renders the entire TDF a prohibited transaction under ERISA Sections 406(a) and 406(b)." MORE >>
"Applicable law already clarifies when a plan fiduciary can and cannot offer alternative investment choices to participants in 401(k) plans.... This suggests that the agenda pursued by at least some advocates of Executive Order 14330 is not the clarification of applicable law. Rather, these proponents seek ... to actively encourage 401(k) arrangements to offer to plan participants alternative investments, most prominently private equity.... [ERISA's] fact-based protective standards should not be attenuated to promote any industry's products, whether those products are ESG assets or alternative investments." MORE >>
"Private equity firms are seeking a new legal definition of an ESOP, a new structure of tax benefits only they can receive, and broad exemptions from five decades of employee protections embedded in [ERISA].... [S]ober analysis of their public assertions and privately shared plans surfaces tremendous problems for the future of existing, and not yet formed, ESOP companies." MORE >>
"Recent regulatory, judicial, and executive developments have reopened the conversation around whether -- and how -- plan sponsors can prudently offer alternative investments in participant-directed defined contribution retirement plans. This article synthesizes the key takeaways from the Ninth Circuit's Intel decision, the Trump Administration's rescission of the ... [DOL's] 2021 cautionary guidance, and President Trump's recent Executive Order aimed at 'democratizing' access to private equity and other alternatives in retirement plans." MORE >>
"Private equity funds can now explore new distribution channels through retirement plans. This includes launching collective investment trusts (CITs), target date funds and managed accounts that incorporate PE exposure. Fund managers have the opportunity to design products tailored for long-term retirement investing, potentially unlocking a vast pool of capital from defined contribution plans." MORE >>
"Private equity's influence on service sectors ... has revealed a troubling pattern: quality can suffer when profit extraction takes precedence.... [P]rivate equity (PE)-backed roll-ups and shifting policy stances are changing how retirement plans are advised and constructed. Fiduciaries must scrutinize ownership structures, compensation models, and product incentives or risk exposing participants to degraded outcomes." MORE >>
"Private equity funds are fundamentally different from mutual funds or ETFs, which have daily liquidity. PE funds are illiquid -- typically locking up capital for 5-10 years. Their valuations are based on models, not transparent market pricing. Their fees can be five to 10 times higher than traditional index funds. The standard for most models is the '2 and 20' model: 2% management fee and 20% of the profits, which is much higher than your typical index fund." MORE >>
"Plaintiffs who have lost at both the district and appellate court level are asking the nation’s highest court to weigh in on a suit involving alternative investments — more specifically the “speculative” nature of a custom target-date fund invested in hedge funds and private equity." [Anderson v. Intel Corp. Inv. Policy Comm., No. 22-16268 (9th Cir. May 22, 2025; cert. pet. filed Oct. 20, 2025 No. 25-498)] MORE >>
"The court held that the private equity fund was under 'common control' with the portfolio companies because it owned a 95% interest in them, and that the fund was a 'trade or business' under the standard set forth in Sun Capital I as a result of it actively managing the portfolio companies. The court declined, however, to hold the private equity fund's general partner or management company liable, concluding that under the standard set forth in Sun Capital II, they did not comprise a partnership-in-fact with the private equity fund or the withdrawing employers such that they could be deemed part of their controlled group." [Longroad Asset Management LLC v. Boilermaker-Blacksmith National Pension Trust, No. 23-0738 (W.D. Mo. Aug. 19, 2025)] MORE >>
"Private equity (PE) and other alternative investment strategies are too complex, illiquid, and risky for casual investors. That's the conventional wisdom used to explain why these types of investments are not offered to working Americans in their 401(k) and 457 retirement plans. But the broader democratization of private market investments and innovations in wealth management suggest we should now take a closer look at whether or not it makes sense for American workers and retirees to access these asset classes if they choose." MORE >>
"Once these alternative investments are available, retirement investors will have the potential for higher returns — but they will also face also new complexities including higher fees, longer lockup periods and less transparency than with stocks and bonds. Understanding the trade-offs and the differences between private credit and private equity is critical for anyone considering them." MORE >>
"Access to workers' nest eggs has long been the goal of the PE industry, and it has lobbied hard for this change. It is more important now than ever. Private equity's performance has been mediocre since the financial crisis and has deteriorated notably since mid-2022.... The PE industry is looking to Trump's EO to make workers' retirement savings available to bail them out. ... The results [of a recent survey] indicate that the EO will likely disappoint the PE industry." MORE >>
"[T]he Information Letter only discussed the inclusion of private equity in asset allocation funds in 401(k) plans. The DOL’s letter explicitly said that it was not talking about standalone private equity investments. Second, the conclusion said, in effect, that ERISA does not prohibit any investment; instead, it places the burden on fiduciaries to determine if they are prudent for retirement investing by the covered workers." MORE >>
"This decision ... is arguably the first time a district court applied the 'investment plus' and 'partnership-in-fact' tests for determining potential withdrawal liability in the private equity context since the First Circuit issued its rulings in Sun Capital ... in 2013 and 2019." [Longroad Asset Management LLC v. Boilermaker-Blacksmith National Pension Trust, No. 23-0738 (W.D. Mo. Aug. 19, 2025)] MORE >>
"This paper explores recent developments that address many of the long-standing investment and operational concerns, making private markets -- especially private equity -- more viable for DC plan sponsors. [The authors] focus on all aspects of the investment process, from asset allocation and portfolio construction to implementation and manager selection." MORE >>
"This article focuses on the DOL's guidance in a 2020 Information Letter ... on the inclusion of private equity in 401(k) plans. The discussion in that Information Letter ... is foundational for any guidance that will be issued by the DOL in response to [Executive Order 14330]." MORE >>
"Private equity and real estate ... can offer access to private deals and growth opportunities not found in typical mutual funds. Annuities ... are marketed as a way to guarantee income in retirement ... However, these offerings are much harder to evaluate and even harder to escape. That makes them risky for the average saver who doesn't have a team of analysts at their side.... The strongest push is coming from the companies that stand to profit, such as insurance firms, recordkeepers and investment managers." MORE >>
"Despite recent guidance, the status of private equity firms and their affiliates as 'employers' for purposes of withdrawal liability remains unsettled. Approaches adopted by courts vary, and the difference could result in exposure for significant withdrawal liability incurred by a portfolio company. Private equity funds that acquire a controlling interest in a portfolio company with unionized operations should exercise particular caution[.]" MORE >>
"[1] Be skeptical about their inclusion in target date funds, consider pushing back on It, and document doing so ... [2] Watch out for private equity assets being back doored into existing fund options ... [3] Focus on exploiting the upcoming safe harbor ... [4] Overcommunicate with participants ... [5] Fully investigate the new investment assets ... [6] Make it a settlor, not fiduciary, decision." MORE >>
"[W]ithout a statutory change, 403(b) investments are still limited to annuity contracts and custodial accounts holding mutual fund investments. None of these will support the typical private equity investment. Even should the proposed 403(b) CIT legislation ever pass, it would likely still be insufficient to support private equity investments from being held by most 403(b) plans." MORE >>
