OneDigital Brings Private Equity to 401(k)s, Joining Industry Shift

ATLANTA, GA – January 20, 2026 – OneDigital today announced it is integrating private investments into its 401(k) offerings, a move that signals a broader industry pivot toward opening historically exclusive asset classes to everyday retirement savers. The financial services firm will incorporate private equity, private credit, and other opportunistic strategies into its Personalized Portfolio program through partnerships with asset management giants Apollo, Ares, and Blackstone.

The initiative aims to provide participants in defined contribution plans with access to the same types of institutional-quality investments that have long been the domain of pension funds and ultra-high-net-worth individuals. By embedding these strategies within professionally managed portfolios, OneDigital intends to enhance diversification and improve long-term retirement outcomes under a structured, fiduciary-led framework.

"At OneDigital, we believe everyone deserves access to the tools that support long-term financial security," said Vincent Morris, President of OneDigital Financial Services, in the company's announcement. "By thoughtfully bringing these strategies into the workplace through our personalized portfolios program, we're expanding access in a structured, fiduciary-aligned way with the aim of improved retirement outcomes over time."

A New Frontier for Retirement Savings

The move represents a significant step in the ongoing "democratization" of finance, breaking down barriers that have kept private market investments out of reach for most Americans. For decades, private equity and credit have offered the potential for higher returns and greater diversification compared to public markets, but their complexity, illiquidity, and high investment minimums made them unsuitable for typical 401(k) lineups.

OneDigital's collaboration with premier global asset managers is central to this new offering. Blackstone, the world's largest alternative asset manager, has been actively developing products for individual investors and recently launched a dedicated business unit to expand private market access within defined contribution plans.

"For decades, private markets have helped institutions achieve potential enhanced returns, greater diversification, and reduced volatility," noted Heather von Zuben, Global Head of Retirement Solutions at Blackstone. "We're proud to work with OneDigital to expand access for retirement savers through a framework that prioritizes participant outcomes."

This sentiment was echoed by Ares Management. "We believe retirement plan participants should have access to private market asset classes, which have the potential to drive growth, generate income, and provide long-term stability," said Raj Dhanda, Global Head of Wealth Management at Ares.

Navigating a Shifting Regulatory Landscape

This industry-wide push into private assets is occurring against the backdrop of a rapidly evolving regulatory environment. The U.S. Department of Labor (DOL), which governs retirement plans under ERISA, has sent mixed signals in recent years, creating both opportunities and caution for plan fiduciaries.

In June 2020, a DOL Information Letter first opened the door, suggesting fiduciaries would not violate their duties simply by offering a professionally managed fund that included a private equity component. However, a more cautious supplemental statement was issued in December 2021, which warned fiduciaries about the complexity, fees, and valuation challenges, stressing that only those with sophisticated expertise should proceed.

This cautionary stance was reversed in August 2025 following Executive Order 14330, which aimed to "Democratize Access to Alternative Assets for 401(k) Investors." The DOL subsequently rescinded its 2021 statement, signaling a more favorable view of alternatives in retirement plans and promising new regulations, which were submitted for review earlier this month and are expected to provide further clarity.

This regulatory back-and-forth places a heavy burden on plan sponsors. While the path is clearer than before, the core fiduciary duty remains: to act prudently and solely in the best interest of plan participants. This means any decision to adopt private asset funds requires rigorous due diligence and ongoing monitoring.

The Fiduciary's Dilemma: Balancing Risk and Reward

For employers and plan committees, the decision to offer private investments involves a careful balancing act. The potential benefits are compelling. Research and historical performance suggest that allocations to private markets can enhance portfolio diversification due to their low correlation with public stocks and bonds, potentially smoothing out volatility and boosting long-term returns.

However, the risks are equally significant. Private assets are inherently illiquid, meaning they cannot be easily bought or sold. Valuations are often determined quarterly, not daily, and the fee structures are typically more complex and expensive than traditional mutual funds.

To mitigate these challenges, OneDigital and its competitors are not offering direct investments in private equity funds. Instead, they are utilizing structures like Collective Investment Trusts (CITs) and managed accounts. Within these vehicles, private assets constitute only a limited portion—often a "sleeve" of 20% or less—of a broader, diversified portfolio. The majority of the fund remains in liquid public market securities, allowing participant transactions like loans, withdrawals, and rebalancing to be handled without having to sell the underlying illiquid holdings.

This professionally managed approach is designed to absorb the operational complexity, but it does not absolve the plan sponsor of their oversight responsibility. Fiduciaries must still understand the strategy, vet the managers, and ensure the fees are reasonable for the value provided.

An Industry-Wide Pivot

OneDigital is not acting in a vacuum. Its announcement follows similar moves by other major players in the retirement industry. Empower, a leading 401(k) recordkeeper, announced its own private markets program in 2025, partnering with many of the same asset managers, including Apollo, Blackstone, and others. Firms like Fidelity and Morgan Stanley have also signaled their intent to integrate private assets into their defined contribution platforms.

This collective movement indicates a fundamental shift in how the industry views the construction of retirement portfolios. It is a response to both market demand and a recognition that the traditional 60/40 stock-and-bond portfolio may not be sufficient to meet the retirement needs of future generations.

Demand from plan participants is growing. A 2025 survey from Schroders found that 45% of participants would invest in private assets if offered. Critically, 77% of those interested said such an offering would motivate them to increase their plan contributions. At the same time, a knowledge gap persists, with over half of participants admitting they do not fully understand these investments and perceive them as risky. This underscores the critical need for clear communication and investor education as these new products roll out. Plan sponsors are also showing increased interest, with a recent State Street survey revealing that the 2025 Executive Order had positively impacted the perceptions of 65% of sponsor respondents. This evolution underscores a new era in retirement planning, where access to sophisticated strategies is paired with an unprecedented need for fiduciary diligence and participant education.