Elizabeth Warren raises concerns about private equity in 401(k)s due to transparency and fee issues
From Yahoo Finance: 2025-06-20 21:30:00
Sen. Elizabeth Warren has expressed concerns about a retirement plan provider’s plan to offer private equity and credit investments in 401(k) accounts. She questioned Empower’s CEO on the move’s alignment with clients’ best interests, investment allocations, and legal advice received. Empower plans to include safeguards like fee reductions and liquidity measures.
Supporters argue that allowing private equity in 401(k) accounts could provide everyday investors access to high-return opportunities. Critics, like Warren, warn of risks due to complex fee structures, limited transparency, and uneven performance. President Trump is reportedly considering an executive order to allow private equity firms to tap into the $9 trillion 401(k) savings pool.
Private equity firms have long sought regulatory changes to access 401(k) savings. Warren’s concerns include potential risks to retirement savings from private equity’s complex fee structures and limited transparency. President Trump is reportedly considering an executive order to allow private equity firms access to the $9 trillion 401(k) savings pool.