--- title: Private Markets Liquidity in 401(k) and DC Plans description: "How DC plans manage liquidity for private market allocations in target-date funds: participant vs. plan-level liquidity, RMDs, and a mass-layoff stress test." image: https://content.investmentsandwealth.org/hubfs/IWR-issue4-Article%208%20Rethinking%20Private%20Markets.png --- [Skip to content](https://content.investmentsandwealth.org/publication/private-markets-liquidity-in-401k-and-dc-plans#main-content) [![Investments & Wealth Institute ](https://content.investmentsandwealth.org/hubfs/content-hub/iwi_logo_w294_h46.svg "Investments & Wealth Institute ")](https://investmentsandwealth.org/) Explore - [All Content](https://4812204.hs-sites.com/content-hub) - [Video](https://4812204.hs-sites.com/content-hub?type=Video) - [eBook](https://4812204.hs-sites.com/content-hub?type=eBook) - [Case Study](https://4812204.hs-sites.com/content-hub?type=Case+Study) - [Blog](https://4812204.hs-sites.com/content-hub?type=Blog) - [Podcasts](https://4812204.hs-sites.com/content-hub?type=podcast) - [Webinars](https://4812204.hs-sites.com/content-hub?type=webinar) - [Find An Advisor](https://www.investmenthelp.org/) - [Contact](https://investmentsandwealth.org/contact-us) - [My Dashboard](https://portal.investmentsandwealth.org/s/login/?startURL=%2Fs%2Fhome-page) - Certifications - [CIMA](https://investmentsandwealth.org/certifications/cima-certification) - [CPWA](https://investmentsandwealth.org/certifications/cpwa-certification) - [RMA](https://investmentsandwealth.org/certifications/rma-certification) - [Help Me Choose](https://investmentsandwealth.org/certifications/compare-iwi-certifications) - [Online Education](https://investmentsandwealth.org/online-learning-financial-advisor-ce) - [Conferences & Events](https://investmentsandwealth.org/financial-advisor-conferences-events) - [Experience 2026](https://experience.investmentsandwealth.org) - [Membership](https://investmentsandwealth.org/membership) - [Publications & Resources](https://content.investmentsandwealth.org/) - [Partner Solutions](https://investmentsandwealth.org/partner-and-sponsor) - [About](https://investmentsandwealth.org/about/mission-purpose-value) Investments & Wealth Review - Number 04, 2026 # Rethinking Private Markets Liquidity in DC Plans Liquidity in Private Market Allocations Isn't a Reason for Zero Allocation Drew Carrington, CFA®, CAIA® The most common objection to private markets in defined contribution plans is liquidity: the assumption that participants need 100 percent daily access to their balances. Drew Carrington argues that assumption does not match how DC plans work. Plans exist to produce retirement income, access before retirement age is already limited by tax policy and penalties, and liquidity is structured around scheduled needs such as rebalancing and required distributions.   Carrington separates participant-level liquidity from plan-level liquidity and shows how rollovers and rebalances are met by netting contributions against outflows and drawing on liquid sleeves and cash buffers, without selling an individual's private holdings. He works through a mass-layoff scenario, RMDs in the drawdown phase, and the behavioral case that limited access helps participants stay invested.   **Key Takeaways** - DC plans manage liquidity at two levels. Participant actions are fulfilled centrally through netting, liquid sleeves, and cash buffers, so a rollover does not force a sale of that participant's private holdings. - Interval and tender-offer vehicles add scheduled monthly or quarterly liquidity windows with stated capacity and notice. - Even a mass layoff with immediate rollover requests is manageable through plan-level liquidity management, with temporary gating only as a last resort. - Georgetown University Center for Retirement Initiatives modeling found that a target-date fund with private market allocations improved retirement income for the "average" U.S. worker by 7.7 percent at the median compared with a typical target-date fund. Instant Access ## Read the Full Publication Our Members receive new publications by mail and in the Membership Newsletter. 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