With more retirement plans such as 401(k)s opening up to alternative assets, SEI’s Ben Heidari explains what it means for asset managers and fund solutions
Ben Heidari, Business Development Leader, Investment Manager Services, SEI
Ben Heidari is a business development leader in SEI’s Investment Manager Services, including collective investment trusts, interval and tender funds, and private asset administration. He’s also on the Board of Directors for Defined Contribution Alternatives Association (DCALTA). Earlier in his career he worked in investment management and financial technology. He’s based in Chicago.
Nasdaq-listed SEI provides fintech, operations, and asset management services to the financial services industry. As of June 2026, SEI managed, advised, or administered approximately $2.1tn assets.
Ben talked with Shaun Beaney, Editor of Preqin First Close, about the shift by US defined contribution plans, including 401(k)s, toward investment in private assets.
We help asset managers, wealth managers, advisors, and institutional investors simplify complexity and deploy capital more effectively – that capital being money, time, and talent – so they can better achieve their growth objectives.
My group, SEI’s Investment Manager Services (IMS), is a global operating platform for asset managers. That’s fund administration, fund accounting, investment ops, investor servicing, and more, for alternative asset classes and traditional public asset classes.
For IMS specifically, we have over 130 clients in alternatives and private markets. We run the gamut in types of firms, although we are especially proud of the new number of large publicly traded alternative asset managers we’ve started to work with over the years – including many household names. We work with them from a fund administration perspective globally. That’s our bread and butter as a private market support platform, and it’s been growing very, very quickly.
In addition to our fund administration business within IMS, we have our collective investment trust (CIT) business. A CIT is a US investment vehicle dedicated to qualified retirement plans. CITs require a trustee to support the vehicle, and SEI has one of the largest third-party trust companies in the industry dedicated to sponsoring CITs. If a large asset manager, whether in public or private assets, wants to issue or launch one of these trusts, they need to partner with a trustee to bring the CIT to market. In partnership with alternative asset managers, we’ve recently brought a number of private-asset CITs to market.
From a high level in the US, DC and 401(k) plans are basically synonymous. There are other plans, but 401(k)s make up about 80% of the DC market. That market is between $14tn and $15tn, so 401k plans are $11tn. When you hear about alts in retirement in the US, it’s mostly about 401(k) plans.
Defined benefit (DB) plans in the US have held alternative investments for a very long time, and at some scale. Some plans have over 20% of their assets in alternatives. But the DC market in the US has less than 1% in aggregate in alternative investments – so there’s an enormous runway to accelerate and start allocating to alternatives in DC. There are close to one million 401(k) plans. Most of those plans are very small, many less than $25mn or so. The biggest pool of assets is actually large and mega plans, even though they make a fraction of the number of plans.
There’s now more ability for alternative investments to be accessed by everyone via professionally managed solutions, not just these large, mega plans that have enough sophistication in house to figure out how to do it.
A lot of it comes down to litigation, cost or fees, liquidity, and valuation. It’s about solving those factors. When you look at the DB market, it’s typically not a daily-activity market. But in the DC market, participants have daily needs. So, we’ve had to solve for the ability to incorporate alternative investments in a daily environment, recognizing that the alternative investment itself is not daily.
The DC or the 401(k) base is highly litigious. There was a lot of hesitancy about getting involved with alternative investments in DC because of that, as well as the liquidity and valuation piece. Some things have changed recently to allow plan sponsors and fiduciaries potentially more flexibility to include alternatives in their retirement plans. The changes include the Presidential Executive Order in August 2025 and Department of Labor rolling guidance earlier this year, which includes a Safe Harbor. We expect to have more formal guidance fairly soon, which should help get more plan sponsors and fiduciaries comfortable allocating to alternatives.
It comes back to the overarching theme of how private assets or alternatives are being incorporated in DC. What we’re incorporating with fiduciaries and plan sponsors are professionally managed solutions, which are target-date funds, advisor-managed accounts, and pooled employer plans (PEPs). In all those scenarios, there's a sophisticated fiduciary on top who manages the pool of capital holistically.
When you have a professionally managed solution, thoughtfully incorporated for the long-term benefit of the participant, you’re able to work on things like solving for liquidity, making sure costs make sense, and making sure the valuation protocol on the private assets is incorporated in the best way possible.
Think of how retirement should work. You want to protect your purchasing power, your real return. What does a really good job of protecting real purchasing power? It's long-term assets like infrastructure, real estate, and other private assets. We’re taking long-term investments and aligning them with long-term goals. If we can improve outcomes, which the data shows we can, that’s the driving force. There’s a huge pool of capital that’s untapped, but it’s for the benefit of the plan participant.
WTW Investments is a global consultant and asset manager. They advise about $4.7tn in assets and manage $178.8bn globally. We’ve been working with them for a number of years. Our relationship stemmed from from our work on the CIT side of things for a mutual client, and WTW’s advice on the asset management side of things. We’ve developed a really healthy relationship, working not only with that client, but also on other strategic initiatives with a focus on inclusion of private assets in DC plans via CITs.
Shaun Beaney is Editor of Preqin First Close. It’s quick, easy, and free to subscribe here.
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Special thanks to Meghan Kolp and Alicia Rudd at SEI, and Noah Lehrecke and Liam Pattinson at BlackRock.
The views expressed are the opinions of SEI as of August 2026. They do not constitute an endorsement, recommendation, or any other advice, and are subject to change. The content does not necessarily express the views of BlackRock, Preqin, or any of their affiliates. SEI is not affiliated with Preqin.