Private equity has long been a staple of institutional portfolios, but it has historically remained out of reach for most retirement plans. That line is beginning to blur.
Recent federal activity has brought clarity to how private equity may fit within retirement plans. Following earlier policy direction, the Department of Labor (DOL) introduced a proposed rule in March 2026 aimed at expanding access to alternative investments. While the proposal does not endorse any specific asset class, it reinforces that fiduciaries have the discretion to evaluate a broad range of investment options—including private equity—within diversified portfolios. As a result, the topic is gaining momentum across the industry and prompting new questions from plan sponsors and advisors alike.
At its core, private equity provides access to privately held companies, often with a long-term growth focus. For advisors and plan sponsors evaluating how to enhance long-term, risk-adjusted returns within a defined contribution menu, private equity may offer exposure to a different growth profile than public markets alone. That said, expanded access does not eliminate risk, and inclusion comes with important considerations.
The DOL’s proposal outlines a framework fiduciaries can use when evaluating investment options, focusing on factors such as performance, fees, liquidity, valuation, benchmarks, and complexity. Because private equity often involves reduced liquidity, distinct valuation methods, and higher fees compared to traditional options, careful, plan-level evaluation remains essential.
It’s also important to note that the rule is still in proposed form. The comment period closes in June 2026, with a final rule anticipated by year-end.
Not every plan will benefit from adding private equity, and not every participant is suited for the additional complexity. The opportunity, where it exists, lies in how thoughtfully it is incorporated into a broader investment strategy. As the regulatory landscape continues to evolve, a measured, well-informed approach remains essential.
DWC works with advisors and plan sponsors to evaluate these evolving investment options in the context of each plan’s goals, structure, and participant needs. That means keeping the conversation grounded in what’s appropriate and thoroughly documented—not just what’s newly available.