Big Take Private Equity’s New Pitch: Investing Your 401(k)
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Mar 25, 2025 Allison McNeely, a Bloomberg reporter with a focus on private equity, dives into the seismic shifts in retirement investing. She explains why private equity firms are now eyeing 401(k) plans, aiming at tapping into a $12 trillion market. The discussion reveals the potential benefits of enhanced returns but warns of risks like liquidity issues and fees. Employees' sentiments regarding these investments are also explored, shedding light on ethical concerns and the impact on retirement planning for everyday Americans.
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Private Equity Seeks New Capital
- Private equity firms are seeking new capital sources to maintain growth.
- They are targeting the $12 trillion in US retirement accounts, like 401ks.
401k Investment Selection
- Many employees are unaware of their 401k investment compositions.
- Fiduciaries bear legal responsibility for selecting safe and responsible investments.
Private Equity in 401ks
- Traditional 401k investments involve stocks and bonds, often within target-date funds.
- Some advocate for including private equity as a valid option within these funds.