By Andrew Welsch

More American retirement savers soon will be able to put private-market investments in their nest eggs.

Empower, one of the nation's largest retirement-services providers, says it will make private investments available later this year in retirement plans it administers on behalf of employers. To do so, Empower is joining forces with some of the nation's largest asset managers, including Apollo, Franklin Templeton, Goldman Sachs, Neuberger Berman, Pimco, Partners Group, and Sagard.

The move by Greenwood, Colo.-based Empower, which administers $1.8 trillion in assets for some 19 million retirement savers, is one of the latest efforts to bring private investments to the masses.

Traditionally an option only for institutions and wealthy individuals, private investments constitute a significant portion of what are known as alternative investments, or alts. Examples of private investments include private equity, private credit, and real estate. Because they tend to be illiquid and carry high fees, it has been difficult to introduce them to the multitrillion-dollar retirement plan marketplace. Another hurdle has been regulations limiting these investments to more sophisticated, wealthier investors. But interest in private investments has grown because they can be noncorrelated with stocks and, depending on the particular investment, used as an inflation hedge and to generate returns or income. They also enable investors to gain exposure to a larger swath of the American economy as the number of public companies has decreased and many companies remain privately held for longer than what was once the norm.

Empower said it would offer investments including private equity, private credit, and private real estate. Its corporate clients will have the final say on which investments are available to their employees.

Empower said private investments may be implemented through collective investment trusts, which are pooled investment funds commonly used in retirement plans because of their liquidity and low costs. CITs will offer "limited exposure" to private investments, Empower said. Notably, Empower is adding an advisory requirement too, saying employers must work with an advisor to offer private investments through a managed account platform created in conjunction with Empower. The company says the requirement is intended to match the investment with an individual's risk tolerance and long-term financial goals.

"Like any investment, we believe in the importance of advice and risk mitigation for every investor," said Empower CEO Edmund F. Murphy III. "These new opportunities offered under an advice model deliver the guardrails necessary to help an entirely new investor class access private investing."

Write to Andrew Welsch at andrew.welsch@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

May 14, 2025 14:18 ET (18:18 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.