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Matthias Knab, Opalesque for New Managers:
Key developments, scale of opportunity, and who stands to win as US DC plans inch toward private markets.
UBP's Private Markets Advisory Team has released the latest edition of UBP's 'Headlines' commentary which discusses the 'Opening of 401(k)s to Private Assets'. Here's a summary with UBP's recommendation what to watch out for next:
In early August, an executive order asked the US Department of Labor and the SEC to lay out, within 180 days, how private equity, private credit, real assets, infrastructure, and even digital assets could be incorporated into defined-contribution plans like 401(k)s, and to craft fiduciary safe harbors for plan sponsors.
Why this matters
- DC plans span 90+ million participants and roughly USD 12 trillion in assets, with about USD 9 trillion in 401(k)s alone.
- Target-date funds (TDFs) hold around 40% of 401(k) assets and are the default in many plans, making them the most likely initial conduit for modest illiquid sleeves.
The fine print
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