Skip to main content

DOL Offers Roadmap for 401(k) Plans to Include Modest Exposure to Private Equity Within Broader Asset Allocation Funds

Client memorandum | June 5, 2020

On June 3, 2020, the U.S. Department of Labor (“DOL”) issued an information letter confirming its view that a defined contribution plan may, under certain circumstances, offer participants an asset allocation or target date fund that includes modest exposure to private equity. Importantly, however, the DOL did not address the various issues presented in allowing participants in a defined contribution plan to obtain direct exposure to private equity funds or investments, noting that such investments present “distinct legal and operational issues.” Nor does the guidance sanction asset allocation funds exclusively or even primarily devoted to private equity investing. The full text of the information letter can be found here.

Additional information

icon View File

This communication is for general information only. It is not intended, nor should it be relied upon, as legal advice. In some jurisdictions, this may be considered attorney advertising. Please refer to the firm’s data policy page for further information.