The Donald J. Trump Fiduciary Cliff-Diving Competition

Sipping Margs' while the Fiduciaries Cliff-Dive

Empower: Making Recordkeeping Great again

Differences in opinion make markets. Yet there isn’t much disagreement within the financial services industry regarding Alternative investments in US retirement accounts. It’s unanimous: Alts are a GREAT FREAKING IDEA.

Among the more vociferous, if arguably uncredentialed advocates: Empower, which serves nearly 20 million Americans, mostly as recordkeeper and administrator for corporate retirement plans.

In May of 2025, Empower’s CEO, Ed Murphy, boldly announced a big 401(k) Alts push, sounding at once self-aggrandizing and patriotic:

Does it give you the chills, just a little? Source: Empower

And also, democratizing:

Source: Empower

Empower’s empowerment of its clients will also empower Empower with more profits, as noted in recent earnings highlights of Great-West Lifeco, its parent company:

Nothing wrong with a recordkeeper making a few more bucks, but ERISA fiduciaries (and sentient humans, interested in making good decisions) can’t ignore potential conflicts of interest, like, for example, the fact that investors will pay ~50x, and sometimes way more, for a dollar invested in Alternatives vs. a simple mix of passive stocks and bonds.

Senator Elizabeth Warren wrote to Empower in response to their patriotic manifesto.

Say what you will about the Senator from Massachusetts; but her questions were salient. Below, a sampling:

Calling Empower’s response dismissive would be generous; it didn’t even mention Warren’s questions. Empower instead seemed to lean on the readers’ proclivity to assume that any question from her must reflect some kind of ludicrous progressive agenda.

Humor us. Look at Senator Warren’s questions again. Do they seem crazy?

Anyway, Empower’s response did run over the usual industry propaganda, relying heavily on FOMO. The gist:

1. There are Fewer public companies today, we are missing out.

2. We did a survey and people said they wanted this, why are we holding people back?

3. Access has historically been limited; we need to change this.

If we were grading Empower here, we’d give them a C+ for argumentation. They lean too heavily on the same propaganda tool. We recommend they read Blackstone and Apollo’s marketing stuff more closely. Still, not bad for a recordkeeper, and they are new at this.

Keeping the momentum going, in late August, Empower hired The Harris Poll, which surveyed 205 benefit administrators, to do an Alts-in-401(k)s vibe check.

We will call it the Harris-Empower survey of distinctly above-average plan administrators. Key takeaways:

Source: Empower

Do the surveyed “high to moderate understanders” know the difference between time-weighted returns and IRRs? Do they understand the pitfalls of Ponzi-esque evergreen secondary funds? Good questions for a follow-up survey, maybe.

Aside: An undisclosed number of the plans surveyed are 403(b) plans, which often are not subject to ERISA and thus operate with a lower legal standard. This may explain why 403(b) plans are often absurdly expensive and shitty. If the AltView (or anyone, really) were earnestly trying to improve the retirement prospects of hard-working, freedom-loving Americans, they’d find lots of low hanging fruit in the realm of 403(b) reform.

Speaking of non-fiduciaries: Despite (because?) it is fixing to make buckets more money with its new arrangement, Empower isn’t a fiduciary either:

They just sellin.’ Source: Empower.

The Empower guys join the rest of the Alts industrial complex in the warm afternoon sun, collecting beefed-up fees regardless of investor outcome, all the while maintaining civilian ‘advisor’ status.

Sipping Margs and enjoying the vicarious thrill while exhorting fiduciaries to dive off the cliff.

But… ¡Toma nota! Margs with well Tequila for recordkeepers; only the PE bros get Don Julio, sorry.

Arthur J. Gallagher and Me

One legally-liable fiduciary is the AltView’s former employer: Arthur J Gallagher. As it happens, the AJG plans’ several billion in retirement assets live at Empower, and this includes a wee bit of savings accumulated during our time in the great insurance broker’s employ.

We like the options and 5.5 basis points per annum for a TDF is a price we are willing to pay. For these reasons, when we left, we left our assets there. Why not?*

But this could change, couldn’t it? The six month deadline for the Department of Labor’s response to Trump’s Alts-Executive order, is rapidly approaching, and 96% (+/- 7.4% using a 95% confidence level 😊) of the land’s plan administrators are desperately seeking clarity.

We will surely keep you posted if we hear if Gallagher (or other Plan Sponsors) decide to join the cliff diving competition.**

Stay Prudent (and not just in the performative sense), Fiduciary-Investors!

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*actually one reason why not is because the Empower people were constantly calling us to try to get us into more expensive investment products that The Alt View neither needs nor wants. Eventually they stopped.

**If Gallagher or others decide to cliff dive, we certainly hope that they don’t rely on the work of Empower’s partners, Goldman or Neuberger; we regard their Alts-return math as fanciful.

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In a future article, we’ll review questions one might ask before investing in Alts.

NOT INVESTMENT ADVICE. INVEST AT YOUR OWN RISK.

Resources:

Empower to Offer Private Markets Investments In Retirement Plans:

https://www.empower.com/press-center/empower-offer-private-markets-investments-retirement-plans

Great West Earnings Release:

https://www.greatwestlifeco.com/investors-analysts/financial-reports.html

Senator Warren Letter to Empower:

https://www.banking.senate.gov/imo/media/doc/Warren%20letter%20to%20Empower%20on%20PE.pdf

Empower Response to Senator Warren:

https://docs.empower.com/press/elizabeth-warren-response-july-2025.pdf

Empower Survey of Above-Average Plan Administrators:

https://www.empower.com/press-center/empower-survey-finds-employers-ready-add-private-market-investments-retirement-plans