Private Investments in Defined Contribution Plans

This white paper discusses the integration of private market investments into defined contribution (DC) plans, focusing on the current state of such investments and their potential benefits for retirement outcomes. The document outlines the importance of these investments, which may include private equity, private credit, and private real estate, highlighting their role in enhancing portfolio diversification and improving long-term performance for participants. It emphasizes that private market strategies should be included within existing investment options rather than offered as standalone choices. The paper also identifies challenges and considerations for plan sponsors, including liquidity management, fee transparency, and regulatory compliance. It presents feedback from industry executives and details how recent innovations and regulatory developments may facilitate the adoption of private market strategies in DC plans. The research aims to educate stakeholders on the value and operational aspects of embedding private investments in retirement portfolios to better serve participants' needs.