What to know about private equity in your 401(k)

BlackRock is making private investments available in employer-sponsored retirement plans

The BlackRock logo is displayed on a smartphone screen, with the company's branding and the BlackRock name clearly visible in the background on April 6, 2025, in Chongqing, China
Private equity investments would mean more choices and potentially higher returns for people investing for retirement — but there are also drawbacks
(Image credit: Cheng Xin / Getty Images)

Historically, private equity has not been among the investment options available for 401(k) plans. But that could soon change, providing a new opportunity for retirement savers — though also one that may carry substantial risk.

In evidence of this potential shift toward private investments, at the end of June, BlackRock, the "world's largest asset manager," announced that it "plans to offer a 401(k) target-date fund with a 5%-to-20% allocation to private investments," said The Wall Street Journal. BlackRock is the "biggest such provider yet to announce that it will make private investments available" in employer-sponsored retirement plans. Still, it "will be up to employers to decide whether they want to add them," said the outlet. Investors, too, should evaluate the opportunity carefully.

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Becca Stanek, The Week US

Becca Stanek has worked as an editor and writer in the personal finance space since 2017. She previously served as a deputy editor and later a managing editor overseeing investing and savings content at LendingTree and as an editor at the financial startup SmartAsset, where she focused on retirement- and financial-adviser-related content. Before that, Becca was a staff writer at The Week, primarily contributing to Speed Reads.