If someone had told me 15 years ago that one of the world’s largest alternative asset managers would be partnering with a mainstream retirement plan provider to bring private market investments into 401(k) plans, I would have assumed they were confusing a pension plan with a hedge fund cocktail party. Yet here we are.
Empower has announced a new partnership with Blackstone, adding private equity, private credit, real estate, and infrastructure strategies to its defined contribution platform. This is not a fringe experiment. This is a serious push to make institutional-style investing available to everyday retirement savers, delivered through collective investment trusts and primarily accessed via managed accounts and advice-based models.
This move didn’t come out of nowhere. Over the past year, Empower has been building a private markets lineup with some of the biggest names in asset management. Blackstone’s entrance adds scale, brand recognition, and credibility to the effort. When a trillion-dollar asset manager steps into the 401(k) space, it’s no longer a theoretical conversation about “someday.” It’s a statement about where the industry thinks retirement investing is heading.
That said, this isn’t about replacing target-date funds or turning participants into day traders of illiquid assets. The pitch is diversification—giving long-term investors exposure beyond public stocks and bonds in a controlled, professionally managed way. Done correctly, that can make sense. Done poorly, it can become a fiduciary headache.
Plan sponsors and advisors should be asking hard questions. How do fees compare? How is liquidity managed? What happens in market stress? How is participant suitability determined? And perhaps most importantly, how do you document fiduciary prudence when offering strategies that most participants have never heard of and don’t fully understand?
Private markets in defined contribution plans are no longer a hypothetical future. They’re here. Whether this becomes a meaningful evolution in retirement investing or an option that only a small percentage of participants ever use will depend on execution, education, and fiduciary discipline.
This isn’t a joke. But it is a turning point worth paying attention to.
