BlackRock, the world’s largest asset manager, is set to introduce private market investments like private equity and private credit into its retirement plans, marking a significant shift in how retirement portfolios are structured, according to a Reuters report.
The New York-based firm announced plans to launch a target-date retirement fund in the first half of 2026. This age-based investment vehicle will combine traditional asset classes like stocks and bonds with private market allocations for the first time. The move aims to enhance returns while diversifying retirement portfolios.
According to a research paper released by BlackRock, the new retirement funds will include a 5% to 20% allocation to private assets, depending on the investor’s age. The firm estimates this could boost returns by an additional 50 basis points annually. BlackRock’s long-term portfolio outlook anticipates a 50% allocation to public equities, 30% to public fixed income, and 20% to private markets.
As a step towards this goal, BlackRock will provide both public and private market investment options for a new target-date fund launched by Great Gray Trust, which manages over $210 billion in assets. Great Gray will utilize BlackRock’s equity, fixed income, and private equity offerings for its retirement fund.
However, industry experts note that while demand for private asset exposure is rising, concerns around liquidity, transparency, and litigation risks remain.
BlackRock CFO Martin Small recently highlighted that a real pathway now exists for integrating private markets into target-date funds but emphasized that regulatory support will be key.
