Why Include Real Estate in 401(k) Investment Menus?
Real Estate 401k strategies explained by Charlie Wenzel. Learn why real estate is vital in retirement plans and fiduciary decisions.
And is it a fiduciary issue to ignore it? Cohen & Steers’ Charlie Wenzel explains.
The video titled “Real Estate in 401(k) Investment. Charlie Wenzel Explains” features an interview between 401(k) Specialist and Charlie Wenzel from Cohen & Steers at the NAPA 401(k) Summit in Las Vegas. They discuss the role of real estate in defined contribution plans, specifically within 401(k) plans.
Key Points:
- Volatility Concerns: Many advisors avoid including real estate in their lineups due to concerns about volatility. However, real estate is one of the best-performing asset classes over the past 10-20 years, and it is a familiar and significant asset class in the U.S.
- Long-Term Investing: Despite concerns, real estate is suitable for long-term retirement plans. It is already included in some target date funds and model portfolios, though not universally.
- Fiduciary Responsibility: Wenzel emphasizes that fiduciaries should consider real estate as it is the third-largest asset class and has been made a sector in the S&P 500. Institutional investors often allocate 10-12% to real estate.
- White Paper: Cohen & Steers has a white paper available on their website, discussing the fiduciary responsibilities and benefits of including real estate in a diversified portfolio.
For more details, you can view the video.
