BlackRock Inc. is advocating for a major shift in retirement investing, arguing that index funds alone are insufficient for today's retirees. Nick Nefouse, the firm's global head of retirement solutions, contends that increased market volatility and concentration require more active management in 401(k) plans. The world's largest asset manager is pushing to include private assets alongside traditional index funds in retirement portfolios.

This stance represents a significant pivot for BlackRock, which built its dominance on indexing after acquiring Barclays Global Investors in 2009. The firm is now aggressively expanding into private markets, having spent over $25 billion acquiring private-markets firms, including $12 billion last year on credit shop HPS Investment Partners. The company plans to debut target-date retirement funds this year that include alternative assets, with private credit likely to be the starting point.

BlackRock's push comes as alternative asset managers like Apollo Global Management Inc. and Blackstone Inc. have been lobbying for private asset inclusion in defined-contribution plans. President Trump's executive order last year aimed to pave the way for more nontraditional investments in 401(k) plans, with a formal proposal expected soon. However, recent writedowns and value declines in private credit funds have raised concerns about placing these assets in individual investors' portfolios. BlackRock plans to add private debt slowly to actively managed target-date funds, starting with just a few percentage points of the total portfolio.