401(k) Alternative Investment Critiques Gloss Over Key Details

Critics of alternative investments often cite high fees, valuation concerns, the lack of exits for private equity portfolio companies, and instability in the private credit market as reasons these investments are unsuitable for defined contribution retirement plans. But these generalized critiques overlook how alternative investments are offered in DC plans today, and the specific manner through which President Donald Trump’s August executive order encouraged federal agencies to expand access to these products: target-date and other asset allocation funds.