Latest news with #JerrySchlichter
Yahoo
13-06-2025
- Business
- Yahoo
Private equity wants in on your 401(k). What you need to know before investing
Chances are very good that your 401(k) does not currently offer you access to private equity investments, which, as the name implies, are investments in companies that are not publicly traded. The question is, will that change in the next few years? And, if it does, is it worth it for you to invest? Large company pension plans and university endowments — both of which have very long time horizons — have invested for years in private equity and private debt funds. But 401(k)s typically haven't offered those options to plan participants. In November 2024, only 2.4% of 401(k) sponsors said they added a private equity investment option to their plan, according to a weekly poll question from the Plan Sponsor Council of America. That may be because employers are afraid of potential lawsuits if they include those options, which typically charge investors more than investment funds in public companies. And under the Employment Retirement Security Act (ERISA), employers have a fiduciary duty to ensure that investment options in your 401(k) are prudent and have reasonable fees, said Jerry Schlichter, founding partner of Schlichter Bogard, who pioneered lawsuits against plan sponsors for charging excess 401(k) fees. It also may be because private assets are riskier to invest in and information about them is opaque, since they're private. So there is less of a requirement to be transparent with investors about how a fund is doing on a regular basis. In addition, private capital options are considered illiquid investments because you can't take your money out whenever you want. And that may prove too constraining for retirement plan participants, who may need access to their 401(k) money for any number of reasons — including changing or losing a job, Schlichter said. There has been an increasing push to provide more private capital investment opportunities for retail investors and participants in workplace retirement plans like 401(k)s and 403(b)s. On the regulatory front, according to Jaret Seiberg, a financial services policy analyst at TD Cowen Washington Research Group, the Trump administration is likely to make it easier to access so-called alternative investments, which include private equity, private real estate and hedge funds. That could result in an executive order from the president requiring government agencies to expand access to such investments as well as rulemaking or guidance from the Department of Labor — which enforces ERISA — 'to expand the ability of individuals to invest in 401(k) and IRA accounts in alternative investments,' Seiberg said in a daily research note. There are far fewer public companies today than there were 30 years ago, as more companies remain private. For that reason, some say, if investors want to own the whole market and have a truly diversified portfolio, where some asset classes move up when others move down, they should have access both to public and private companies. In a recent conversation with Morningstar, BlackRock chief operating officer Robert Goldstein noted that the performances of publicly traded stocks and bonds have become more correlated than they used to be, and 'many of the less correlated assets are only accessible through the private markets.' That may be. Or not. For average retail investors, it could be hard to tell because there currently isn't a centralized way to track the performance and underlying investments of private capital funds and directly compare them to that of the stock and bond funds and indexes they're used to. That's just one reason why other market watchers and investor advocates worry about expanding access to private capital for average retirement savers. Among those squarely in the camp of those who say employee and retiree nest eggs won't be helped — and could be harmed — by having exposure to private capital is Benjamin Schiffrin, director of securities policy at Better Markets, a nonprofit seeking to promote the public interest in financial markets. 'Why is there a push to open up the private markets to 401(k)s now? It's not because workers want less liquid and harder-to-value assets in their 401(k)s. And it's not motivated by plan sponsors, who have long worried that exposing 401(k) plan participants to private market assets would violate their fiduciary duty to act in the best interest of the investors,' Schiffrin said in a statement. 'It's because private market firms are finding it harder now to raise money. Their traditional sources of funding — institutional investors such as pensions and endowments — have evaporated.' Indeed, for plan sponsors, including private equity among their plan's investment options will require a lot more due diligence from them in terms of investigating the underlying investments in a given fund and examining the fee structure, Schlichter said. 'This is fraught with danger. A company that puts private equity in its 401(k) is undertaking a serious risk of breaching its fiduciary duty.' Credit ratings agency Moody's this week put out an analysis, first reported by the Wall Street Journal, which cautioned that the accelerated push to give private capital firms access to the multitrillion-dollar retirement investment industry holds risk for everyone. 'Competition for retail investor capital within private markets will intensify as alternative asset managers roll out new partnerships and special funds to address this potentially vast, still largely untapped market,' the analysts wrote. 'But rapid growth within this still relatively opaque market also carries systemic implications.' One example, they cited, is the potential for a liquidity crisis. 'Unlike institutional investors, retail investors expect ready access to their cash. To help, managers are launching products with periodic windows of liquidity. But in volatile markets, retail investors may run for the exits, which would exacerbate liquidity needs and the risk of potential mismatches between a product's available liquidity and what investors are expecting.' The promise of investing in private equity is that the additional expense and risk assumed by investors can be rewarded with potentially strong returns over time. While it's hard to easily and quickly track private equity performance on your own, there have been academic and industry studies on it, and the results have been mixed, said Jason Kephart, senior principal for multi-asset strategy ratings at Morningstar. So, while you will likely pay more and have less transparency into what you're investing in, having a stake in private capital is no guarantee that you will enjoy meaningfully better returns in your portfolio. As for the diversification argument, Kephart said, it's worth remembering that just as with public companies, private companies' performance will be affected by external forces such as economic downturns, interest rates, geopolitical concerns, tariffs and supply chain issues. 'Being private doesn't shield you from the world,' he noted. And, Kephart added, 'It's not like the public markets are broken. Public stocks and bonds have paid off pretty well for those who've stayed invested.' Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
CNN
13-06-2025
- Business
- CNN
Private equity wants in on your 401(k). What you need to know before investing
Chances are very good that your 401(k) does not currently offer you access to private equity investments, which, as the name implies, are investments in companies that are not publicly traded. The question is, will that change in the next few years? And, if it does, is it worth it for you to invest? Large company pension plans and university endowments — both of which have very long time horizons — have invested for years in private equity and private debt funds. But 401(k)s typically haven't offered those options to plan participants. In November 2024, only 2.4% of 401(k) sponsors said they added a private equity investment option to their plan, according to a weekly poll question from the Plan Sponsor Council of America. That may be because employers are afraid of potential lawsuits if they include those options, which typically charge investors more than investment funds in public companies. And under the Employment Retirement Security Act (ERISA), employers have a fiduciary duty to ensure that investment options in your 401(k) are prudent and have reasonable fees, said Jerry Schlichter, founding partner of Schlichter Bogard, who pioneered lawsuits against plan sponsors for charging excess 401(k) fees. It also may be because private assets are riskier to invest in and information about them is opaque, since they're private. So there is less of a requirement to be transparent with investors about how a fund is doing on a regular basis. In addition, private capital options are considered illiquid investments because you can't take your money out whenever you want. And that may prove too constraining for retirement plan participants, who may need access to their 401(k) money for any number of reasons — including changing or losing a job, Schlichter said. There has been an increasing push to provide more private capital investment opportunities for retail investors and participants in workplace retirement plans like 401(k)s and 403(b)s. On the regulatory front, according to Jaret Seiberg, a financial services policy analyst at TD Cowen Washington Research Group, the Trump administration is likely to make it easier to access so-called alternative investments, which include private equity, private real estate and hedge funds. That could result in an executive order from the president requiring government agencies to expand access to such investments as well as rulemaking or guidance from the Department of Labor — which enforces ERISA — 'to expand the ability of individuals to invest in 401(k) and IRA accounts in alternative investments,' Seiberg said in a daily research note. There are far fewer public companies today than there were 30 years ago, as more companies remain private. For that reason, some say, if investors want to own the whole market and have a truly diversified portfolio, where some asset classes move up when others move down, they should have access both to public and private companies. In a recent conversation with Morningstar, BlackRock chief operating officer Robert Goldstein noted that the performances of publicly traded stocks and bonds have become more correlated than they used to be, and 'many of the less correlated assets are only accessible through the private markets.' That may be. Or not. For average retail investors, it could be hard to tell because there currently isn't a centralized way to track the performance and underlying investments of private capital funds and directly compare them to that of the stock and bond funds and indexes they're used to. That's just one reason why other market watchers and investor advocates worry about expanding access to private capital for average retirement savers. Among those squarely in the camp of those who say employee and retiree nest eggs won't be helped — and could be harmed — by having exposure to private capital is Benjamin Schiffrin, director of securities policy at Better Markets, a nonprofit seeking to promote the public interest in financial markets. 'Why is there a push to open up the private markets to 401(k)s now? It's not because workers want less liquid and harder-to-value assets in their 401(k)s. And it's not motivated by plan sponsors, who have long worried that exposing 401(k) plan participants to private market assets would violate their fiduciary duty to act in the best interest of the investors,' Schiffrin said in a statement. 'It's because private market firms are finding it harder now to raise money. Their traditional sources of funding — institutional investors such as pensions and endowments — have evaporated.' Indeed, for plan sponsors, including private equity among their plan's investment options will require a lot more due diligence from them in terms of investigating the underlying investments in a given fund and examining the fee structure, Schlichter said. 'This is fraught with danger. A company that puts private equity in its 401(k) is undertaking a serious risk of breaching its fiduciary duty.' Credit ratings agency Moody's this week put out an analysis, first reported by the Wall Street Journal, which cautioned that the accelerated push to give private capital firms access to the multitrillion-dollar retirement investment industry holds risk for everyone. 'Competition for retail investor capital within private markets will intensify as alternative asset managers roll out new partnerships and special funds to address this potentially vast, still largely untapped market,' the analysts wrote. 'But rapid growth within this still relatively opaque market also carries systemic implications.' One example, they cited, is the potential for a liquidity crisis. 'Unlike institutional investors, retail investors expect ready access to their cash. To help, managers are launching products with periodic windows of liquidity. But in volatile markets, retail investors may run for the exits, which would exacerbate liquidity needs and the risk of potential mismatches between a product's available liquidity and what investors are expecting.' The promise of investing in private equity is that the additional expense and risk assumed by investors can be rewarded with potentially strong returns over time. While it's hard to easily and quickly track private equity performance on your own, there have been academic and industry studies on it, and the results have been mixed, said Jason Kephart, senior principal for multi-asset strategy ratings at Morningstar. So, while you will likely pay more and have less transparency into what you're investing in, having a stake in private capital is no guarantee that you will enjoy meaningfully better returns in your portfolio. As for the diversification argument, Kephart said, it's worth remembering that just as with public companies, private companies' performance will be affected by external forces such as economic downturns, interest rates, geopolitical concerns, tariffs and supply chain issues. 'Being private doesn't shield you from the world,' he noted. And, Kephart added, 'It's not like the public markets are broken. Public stocks and bonds have paid off pretty well for those who've stayed invested.'
CNN
13-06-2025
- Business
- CNN
Private equity wants in on your 401(k). What you need to know before investing
Chances are very good that your 401(k) does not currently offer you access to private equity investments, which, as the name implies, are investments in companies that are not publicly traded. The question is, will that change in the next few years? And, if it does, is it worth it for you to invest? Large company pension plans and university endowments — both of which have very long time horizons — have invested for years in private equity and private debt funds. But 401(k)s typically haven't offered those options to plan participants. In November 2024, only 2.4% of 401(k) sponsors said they added a private equity investment option to their plan, according to a weekly poll question from the Plan Sponsor Council of America. That may be because employers are afraid of potential lawsuits if they include those options, which typically charge investors more than investment funds in public companies. And under the Employment Retirement Security Act (ERISA), employers have a fiduciary duty to ensure that investment options in your 401(k) are prudent and have reasonable fees, said Jerry Schlichter, founding partner of Schlichter Bogard, who pioneered lawsuits against plan sponsors for charging excess 401(k) fees. It also may be because private assets are riskier to invest in and information about them is opaque, since they're private. So there is less of a requirement to be transparent with investors about how a fund is doing on a regular basis. In addition, private capital options are considered illiquid investments because you can't take your money out whenever you want. And that may prove too constraining for retirement plan participants, who may need access to their 401(k) money for any number of reasons — including changing or losing a job, Schlichter said. There has been an increasing push to provide more private capital investment opportunities for retail investors and participants in workplace retirement plans like 401(k)s and 403(b)s. On the regulatory front, according to Jaret Seiberg, a financial services policy analyst at TD Cowen Washington Research Group, the Trump administration is likely to make it easier to access so-called alternative investments, which include private equity, private real estate and hedge funds. That could result in an executive order from the president requiring government agencies to expand access to such investments as well as rulemaking or guidance from the Department of Labor — which enforces ERISA — 'to expand the ability of individuals to invest in 401(k) and IRA accounts in alternative investments,' Seiberg said in a daily research note. There are far fewer public companies today than there were 30 years ago, as more companies remain private. For that reason, some say, if investors want to own the whole market and have a truly diversified portfolio, where some asset classes move up when others move down, they should have access both to public and private companies. In a recent conversation with Morningstar, BlackRock chief operating officer Robert Goldstein noted that the performances of publicly traded stocks and bonds have become more correlated than they used to be, and 'many of the less correlated assets are only accessible through the private markets.' That may be. Or not. For average retail investors, it could be hard to tell because there currently isn't a centralized way to track the performance and underlying investments of private capital funds and directly compare them to that of the stock and bond funds and indexes they're used to. That's just one reason why other market watchers and investor advocates worry about expanding access to private capital for average retirement savers. Among those squarely in the camp of those who say employee and retiree nest eggs won't be helped — and could be harmed — by having exposure to private capital is Benjamin Schiffrin, director of securities policy at Better Markets, a nonprofit seeking to promote the public interest in financial markets. 'Why is there a push to open up the private markets to 401(k)s now? It's not because workers want less liquid and harder-to-value assets in their 401(k)s. And it's not motivated by plan sponsors, who have long worried that exposing 401(k) plan participants to private market assets would violate their fiduciary duty to act in the best interest of the investors,' Schiffrin said in a statement. 'It's because private market firms are finding it harder now to raise money. Their traditional sources of funding — institutional investors such as pensions and endowments — have evaporated.' Indeed, for plan sponsors, including private equity among their plan's investment options will require a lot more due diligence from them in terms of investigating the underlying investments in a given fund and examining the fee structure, Schlichter said. 'This is fraught with danger. A company that puts private equity in its 401(k) is undertaking a serious risk of breaching its fiduciary duty.' Credit ratings agency Moody's this week put out an analysis, first reported by the Wall Street Journal, which cautioned that the accelerated push to give private capital firms access to the multitrillion-dollar retirement investment industry holds risk for everyone. 'Competition for retail investor capital within private markets will intensify as alternative asset managers roll out new partnerships and special funds to address this potentially vast, still largely untapped market,' the analysts wrote. 'But rapid growth within this still relatively opaque market also carries systemic implications.' One example, they cited, is the potential for a liquidity crisis. 'Unlike institutional investors, retail investors expect ready access to their cash. To help, managers are launching products with periodic windows of liquidity. But in volatile markets, retail investors may run for the exits, which would exacerbate liquidity needs and the risk of potential mismatches between a product's available liquidity and what investors are expecting.' The promise of investing in private equity is that the additional expense and risk assumed by investors can be rewarded with potentially strong returns over time. While it's hard to easily and quickly track private equity performance on your own, there have been academic and industry studies on it, and the results have been mixed, said Jason Kephart, senior principal for multi-asset strategy ratings at Morningstar. So, while you will likely pay more and have less transparency into what you're investing in, having a stake in private capital is no guarantee that you will enjoy meaningfully better returns in your portfolio. As for the diversification argument, Kephart said, it's worth remembering that just as with public companies, private companies' performance will be affected by external forces such as economic downturns, interest rates, geopolitical concerns, tariffs and supply chain issues. 'Being private doesn't shield you from the world,' he noted. And, Kephart added, 'It's not like the public markets are broken. Public stocks and bonds have paid off pretty well for those who've stayed invested.'
CNN
13-06-2025
- Business
- CNN
Private equity wants in on your 401(k). What you need to know before investing
Chances are very good that your 401(k) does not currently offer you access to private equity investments, which, as the name implies, are investments in companies that are not publicly traded. The question is, will that change in the next few years? And, if it does, is it worth it for you to invest? Large company pension plans and university endowments — both of which have very long time horizons — have invested for years in private equity and private debt funds. But 401(k)s typically haven't offered those options to plan participants. In November 2024, only 2.4% of 401(k) sponsors said they added a private equity investment option to their plan, according to a weekly poll question from the Plan Sponsor Council of America. That may be because employers are afraid of potential lawsuits if they include those options, which typically charge investors more than investment funds in public companies. And under the Employment Retirement Security Act (ERISA), employers have a fiduciary duty to ensure that investment options in your 401(k) are prudent and have reasonable fees, said Jerry Schlichter, founding partner of Schlichter Bogard, who pioneered lawsuits against plan sponsors for charging excess 401(k) fees. It also may be because private assets are riskier to invest in and information about them is opaque, since they're private. So there is less of a requirement to be transparent with investors about how a fund is doing on a regular basis. In addition, private capital options are considered illiquid investments because you can't take your money out whenever you want. And that may prove too constraining for retirement plan participants, who may need access to their 401(k) money for any number of reasons — including changing or losing a job, Schlichter said. There has been an increasing push to provide more private capital investment opportunities for retail investors and participants in workplace retirement plans like 401(k)s and 403(b)s. On the regulatory front, according to Jaret Seiberg, a financial services policy analyst at TD Cowen Washington Research Group, the Trump administration is likely to make it easier to access so-called alternative investments, which include private equity, private real estate and hedge funds. That could result in an executive order from the president requiring government agencies to expand access to such investments as well as rulemaking or guidance from the Department of Labor — which enforces ERISA — 'to expand the ability of individuals to invest in 401(k) and IRA accounts in alternative investments,' Seiberg said in a daily research note. There are far fewer public companies today than there were 30 years ago, as more companies remain private. For that reason, some say, if investors want to own the whole market and have a truly diversified portfolio, where some asset classes move up when others move down, they should have access both to public and private companies. In a recent conversation with Morningstar, BlackRock chief operating officer Robert Goldstein noted that the performances of publicly traded stocks and bonds have become more correlated than they used to be, and 'many of the less correlated assets are only accessible through the private markets.' That may be. Or not. For average retail investors, it could be hard to tell because there currently isn't a centralized way to track the performance and underlying investments of private capital funds and directly compare them to that of the stock and bond funds and indexes they're used to. That's just one reason why other market watchers and investor advocates worry about expanding access to private capital for average retirement savers. Among those squarely in the camp of those who say employee and retiree nest eggs won't be helped — and could be harmed — by having exposure to private capital is Benjamin Schiffrin, director of securities policy at Better Markets, a nonprofit seeking to promote the public interest in financial markets. 'Why is there a push to open up the private markets to 401(k)s now? It's not because workers want less liquid and harder-to-value assets in their 401(k)s. And it's not motivated by plan sponsors, who have long worried that exposing 401(k) plan participants to private market assets would violate their fiduciary duty to act in the best interest of the investors,' Schiffrin said in a statement. 'It's because private market firms are finding it harder now to raise money. Their traditional sources of funding — institutional investors such as pensions and endowments — have evaporated.' Indeed, for plan sponsors, including private equity among their plan's investment options will require a lot more due diligence from them in terms of investigating the underlying investments in a given fund and examining the fee structure, Schlichter said. 'This is fraught with danger. A company that puts private equity in its 401(k) is undertaking a serious risk of breaching its fiduciary duty.' Credit ratings agency Moody's this week put out an analysis, first reported by the Wall Street Journal, which cautioned that the accelerated push to give private capital firms access to the multitrillion-dollar retirement investment industry holds risk for everyone. 'Competition for retail investor capital within private markets will intensify as alternative asset managers roll out new partnerships and special funds to address this potentially vast, still largely untapped market,' the analysts wrote. 'But rapid growth within this still relatively opaque market also carries systemic implications.' One example, they cited, is the potential for a liquidity crisis. 'Unlike institutional investors, retail investors expect ready access to their cash. To help, managers are launching products with periodic windows of liquidity. But in volatile markets, retail investors may run for the exits, which would exacerbate liquidity needs and the risk of potential mismatches between a product's available liquidity and what investors are expecting.' The promise of investing in private equity is that the additional expense and risk assumed by investors can be rewarded with potentially strong returns over time. While it's hard to easily and quickly track private equity performance on your own, there have been academic and industry studies on it, and the results have been mixed, said Jason Kephart, senior principal for multi-asset strategy ratings at Morningstar. So, while you will likely pay more and have less transparency into what you're investing in, having a stake in private capital is no guarantee that you will enjoy meaningfully better returns in your portfolio. As for the diversification argument, Kephart said, it's worth remembering that just as with public companies, private companies' performance will be affected by external forces such as economic downturns, interest rates, geopolitical concerns, tariffs and supply chain issues. 'Being private doesn't shield you from the world,' he noted. And, Kephart added, 'It's not like the public markets are broken. Public stocks and bonds have paid off pretty well for those who've stayed invested.'
Yahoo
30-05-2025
- Business
- Yahoo
Is all hell about to break loose in your 401(k)?
Is your 401(k) about to get too risky? The Labor Department is now officially neutral on whether companies should allow cryptocurrency in 401(k) plans, and, in general, the government is in favor of private equity and annuities as investment options. But there are many, many steps before people can possibly buy bitcoin or a piece of the initial-public-offering market or a complicated long-term insurance contract through their employer. My father-in-law has dementia and is moving in with us. Can we invoice him for a caregiver? 'The situation is extreme': I'm 65 and leaving my estate to only one grandchild. Can the others contest my will? My life partner is 18 years my senior. He wants to leave his $4.5 million fortune to me — not his two kids. Do we tell them? My ex-wife said she should have been compensated for working part time during our marriage. Do I owe her? Stock bulls should resist exiting this market. These five pillars of support are coming. 'It can take years to get a fund added,' said David O'Meara, head of defined-contribution investment strategy at WTW, a workplace consulting firm. Most workplace retirement plans have a very limited menu of investment options available to participants, usually 15 to 35 carefully curated mutual funds. The majority of these slots are filled with target-date funds, which are professionally managed portfolios designed to get more conservative as a worker approaches retirement age. So 10 out of the total might be a different-year version of the Vanguard Target Retirement Fund 2050 VFIFX. A participant might also have the Vanguard Target Retirement Fund 2055VFFVX, and so forth. The rest are likely a mix of sectors and other indexes, with one each of a large cap, small cap, international and bond fund. Many workplaces also allow employees access to what's called a brokerage window, which allows them to put some or all of their contributions into a self-directed account within their retirement plan, usually for extra fees and with a lot of paperwork involved. There's a deliberate process for changing anything to do with a workplace plan like a 401(k), 403(b) or 457, because employers are held to a strict fiduciary standard. That means they not only have to act in the best interests of their employees, but they must act as a 'prudent financial investor for the exclusive sole benefit of the employee,' said Jerry Schlichter, an attorney who has spearheaded landmark cases against high fees in employer plans. Any fund or option an employer adds has to be thoroughly researched and deemed to be in the best interests of their workforce. 'It's a very high bar for fiduciaries to change what they are doing and justify new additions,' O'Meara said. Most large employers or worker groups have an investment advisory committee that evaluates the elements of a retirement plan and its ongoing performance. I've been an employee representative to such a committee, which had quarterly meetings to go over spreadsheets of return data and employee engagement. Considering whether to add a new fund involved a long process. Most of the time, changes only happen when something has gone wrong in a fund, a company or the economy, and it's an emergency. Katie Hockenmaier, defined-contribution research director for Mercer, a workplace consulting firm, has seen swap-outs get decided on in six months or so, including about 90 days for implementation with the recordkeeper. But in general, she said, most plan fiduciary committees are doing a broad look every three years where they take a step back and see if they're still offering appropriate choices for their demographics. 'If a change requires changes to the plan document or to operational infrastructure, in theory, these could take a year or longer, depending on all of the elements you need to consider,' she said. Fiduciary investment committees are bound by law to take their jobs very seriously, and if they don't, there are lawyers like Schlichter to hold them accountable. That's why Schlichter is among those who do not foresee crypto or private-equity investing opportunities coming directly to employees in 401(k) plans as one of their menu options. The more likely scenario is that they would be added as an option for the portfolio managers of the funds that are in the menu. Those fund managers would then have to manage the risk-reward balance, and all of them would be accountable if they were not careful with employees' life savings. 'They have to be the gatekeepers to make sure fees are reasonable and investments are sound,' he said. 'Let's say 20% of a target-date fund was in crypto. Is that going to jeopardize return or provide excess risk compared to something more stable or more predictable? The underlying duty of the fiduciary is to take into account that it is part of the investment.' On the private-equity and annuity side, he cautioned that the illiquidity of those kinds of investments could mean that the fund is keeping a higher amount of cash as a cushion. Think of a scenario where a company is acquired and the employees all cash out their retirement accounts in the process of rolling them over to a new custodian. If their money is tied up in a private-equity investment that can't pay out for a few years, they'd be broke. On top of that, Schlichter noted that a large cash holding might be losing ground to inflation and high fees. 'The whole point is that you were supposed to have a better return with private equity, but you burn it out of the box with 25% earning nothing,' he said. While funds have been slow so far to add crypto to holdings, some plan administrators have nonetheless signaled their intent to add access to private-equity holdings to their funds, like Empower recently did. But just because the government allows access to certain investments and then the plan administrator does, that does not mean portfolio managers are necessarily jumping on board yet. And the employee always makes the final choice on the investments for their retirement savings — that is, if they can wade through the materials and understand how the funds work instead of going with the default option. If you are worried about risk and high fees, it's best to keep your retirement investments simple. Going forward, that may mean making sure that the target-date fund you select based on your prospective retirement date doesn't take undue risks. You may need to dig a little and look at the holdings, which you can do by looking up the ticker symbol or searching on your custodian's website. If you don't like your choices, you can petition your employer to make changes. If you do want access to these investments, especially crypto, then you might want to look into the brokerage window your custodian provides. There may be some restrictions, however, Hockenmaier said. Your company could limit the amount you can invest, the types of investments you can access or the number of transactions per month. Many companies restrict employees from investing in company stock, for example. The fiduciary obligation extends to these brokerage accounts, too, according to Schlichter. 'The employee is relying on the employer, and not to be out there in the Darwinian market to sort through thousands of investment options,' he said. 'If there is a brokerage window that says you can invest in the whole market, you have to curate. Otherwise it's the Wild West, and the whole purpose of the law is not being accomplished.' Got a question about investing, how it fits into your overall financial plan and what strategies can help you make the most out of your money? You can write to me at . Please put 'Fix My Portfolio' in the subject line. You can also join the Retirement conversation in our . Trade court strikes down Trump tariffs: What it means for markets — and what's next It's my dream to travel to Africa. My husband says it's not on his bucket list. Do I pay for him or go alone? My friend is getting divorced. Her husband kindly said, 'Take the house.' Is there a catch? My daughter's boyfriend, a guest in my home, offered to powerwash part of my house — then demanded money 'Is this a good tax strategy or a sham transaction?' My mother wants to give me her home. I have a plan to avoid taxes. 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