A Whole New Ball Game

Today’s evolving financial landscape creates new opportunities for employers to help their workforces build wealth through strategies once reserved for only the wealthiest individuals. Recent regulatory rule changes have broadened participants’ access to more diverse investment categories, while technological advances have allowed for more personalized asset allocations and greater access to financial advice. Creative Planning has long advocated for the democratization of financial resources. Organizations ought to evaluate these new opportunities and consider whether and how they may better serve their workforce.

In March, the Department of Labor released “Fiduciary Duties in Selecting Designated Investment Alternatives.” This proposed rule clarifies employers’ fiduciary responsibilities when considering alternative assets in their retirement plans and offers a Safe Harbor method for evaluation. 

Alternative assets are generally considered any investment where the price of that investment isn’t valued daily and could include private equity, private credit and direct real estate. Traditionally, these asset classes have been available only outside employer-sponsored retirement plans, limited to ultra-high-net-worth investors. Regular participants may now also enjoy the potential diversification and returns of these private asset groups. 

However, private assets present unique risk factors that plan sponsors must consider before introducing them as investment options to participants in their sponsored retirement plans. Any private asset funds should allow participants to easily withdraw their money when needed. Asset managers for private assets must also adopt a standardized method for regularly valuing assets—if not daily, then at least quarterly—so that participants can monitor their savings and plan sponsors can prudently monitor performance. 

Plan sponsors must also evaluate the appropriateness of an investment’s fees, evaluate the investment’s performance net of its fees and benchmark its performance against a comparable index or peer group. These challenges can be overcome with the guidance of a fiduciary advisor experienced in both employer-sponsored retirement plans and the private markets. And if deemed prudent, the rewards provide average wage earners with access to wealth strategies once limited to C-suite executives.

Beyond investment offerings, a participant’s asset allocation remains one of the greatest drivers of long-term outcomes. The tools used to allocate participants’ retirement plan money have evolved significantly over the decades. The one-size-fits-all 60/40 “balanced” portfolio evolved into the more dynamic target-date fund. 

Still, apart from differentiating by age, target-date funds offer only one allocation strategy for all participants, regardless of an individual’s personal financial circumstances. Current technology allows personalized allocations to be automated within the retirement plan. Instead of requiring participants to complete a survey or input data, which can be a hindrance, much of the data needed for a personalized allocation already feeds into the retirement plan through payroll. The technology within these managed accounts automatically updates a participant’s asset allocation in response to changes in their financial profile, creating a more personalized investment journey.

Of course, any conversation about technology must include a mention of artificial intelligence. While some have suggested that AI will replace the need for financial advisers, we believe AI will accelerate the financial advisers’ ability. The reality is that there are far more Americans in need of financial advice—but without access to it—than there are those with access to financial advice. Either the cost to provide that advice has been prohibitive, or the advice can’t be accessed conveniently. 

AI changes this. More than displacing financial advisors, AI can broaden their reach, giving more people access to personalized financial planning. Human interaction will always be the foundation of any adviser relationship, but for the vast majority of individuals currently without access to any financial advice whatsoever, AI can provide them with initial direction for their financial journey, with the ever-available option of a human advisor for more strategic planning. 

This powerful technology will soon be a mainstay of employer-sponsored retirement plans. Plan sponsors should ensure that AI advice meets fiduciary standards and isn’t merely pushing products on participants. The best alignment comes when the retirement plan’s adviser has a stated fiduciary obligation to the plan, and the AI technology is an extension of that adviser’s guidance. 

This is a time of change across all industries—none more so than financial services. We’ll continue to see greater access for the many to the knowledge and resources that had once been limited to the few. Employers have a responsibility to prudently evaluate these new opportunities. Engaging with a trusted advisor who has a stated fiduciary commitment to serving clients’ best interests will be critical in navigating this new environment.

This commentary is provided for general information purposes only, should not be construed as investment, tax or legal advice, and does not constitute an attorney/client relationship. Past performance of any market results is no assurance of future performance. The information contained herein has been obtained from sources deemed reliable but is not guaranteed.

PUBLISHED MAY 2026