Retirement planning looks a lot different than it did a generation ago. With longer life expectancies, persistent inflation, and unpredictable markets, relying solely on stocks and bonds no longer feels like enough. That’s where alternative investments come in — they offer new ways to generate income, manage risk, and build a stronger foundation for the years ahead.
What Are Alternative Investments?
Alternative investments are assets that fall outside traditional categories like stocks, bonds, or cash. They often behave differently from public markets. They can offer unique advantages, though they often require longer holding periods and come with less liquidity.
Why They Deserve a Place in Your Retirement Plan
Retirement investing is about protecting what you’ve built, managing volatility, and creating sustainable income. Alternative investments can:
- Add diversification to your portfolio when markets turn unstable
- Generate income through vehicles such as real estate and private credit
- Help hedge against inflation, protecting your buying power
- Provide growth opportunities while minimizing direct ties to public markets
Of course, they’re not without drawbacks. Alternatives tend to be more difficult to access, carry lower liquidity, and involve greater complexity. But when used thoughtfully, they can complement traditional assets in a powerful way.
A Closer Look at Common Alternatives
Here’s how the most common types of alternative investments can support your retirement strategy.
Private Equity
Private equity involves investing in privately owned businesses, often through funds that buy, grow, and later sell these companies. It’s a long-term play — holding periods often stretch seven to ten years — but the return potential can be substantial. These investments are becoming more accessible to individuals through retirement-focused platforms.
Specialized firms play a vital role here, handling the tax services for private equity funds and managing complex reporting. Their work ensures transparency for all stakeholders, including pension funds that manage retirement dollars for millions of people.
Real Estate
Private real estate covers investments like rental homes, pooled syndication deals, and non-publicly traded REITs. These assets generate ongoing income and may appreciate over time. Because they tend to move independently from stock markets, they’re useful for diversification. That said, real estate investments typically require a longer commitment and careful review of location, asset type, and deal structure.
Private Credit
Private credit funds provide loans straight to companies or individuals, sidestepping conventional banks. These loans generate interest income, making them attractive for retirees who want reliable cash flow. However, they’re less liquid and often require a holding period of three to five years. Risk varies depending on borrower’s credit quality and fund strategy.
Hedge Funds
Hedge funds use flexible strategies — such as short selling, leverage, or derivatives — to generate returns across market cycles. While some aim for high growth, others focus on capital preservation. Not all hedge funds fit retirement goals, but select options may reduce portfolio volatility. They do come with high fees and entry requirements.
Infrastructure
Infrastructure investments cover assets like toll roads, airports, power stations, and water networks. These projects often generate stable, long-term income backed by government or private contracts. Infrastructure adds predictability and often tracks inflation — helpful qualities when you’re managing retirement income. Many institutional portfolios include this asset class for its resilience.
Commodities
Commodities, like gold, oil, and farm produce, act as a buffer against geopolitical instability and inflation. Since they don’t move in sync with stocks or bonds, they can help reduce overall volatility. But they’re volatile on their own and don’t produce income, so most investors keep their exposure limited.
Collectibles
Investing in art, wine, vintage cars, or rare coins appeals to some, but these assets come with unique risks. Values are subjective, and markets can be thin. While collectibles may gain value over time, they’re illiquid and hard to price accurately. If you go this route, keep exposure small and buy what you genuinely enjoy.
Investing in Your Health Is Also a Retirement Strategy
We often focus on the financials of retirement, but what about the physical side of things — the daily habits that determine your quality of life as you age? Longevity is about maintaining the strength, clarity, and independence to enjoy those extra years.
This is where your environment, especially your home workspace, plays a surprising role. If you’re still working remotely, semi-retired, or just spending more time at home, investing in the right tools for daily comfort matters. Something as simple as standing desks for a healthier home office setup can make a meaningful difference in posture, circulation, and energy levels. Over time, that leads to better mobility and fewer health costs.
Consider these habits as part of your retirement portfolio:
- Daily movement — whether walking, stretching, or doing strength exercises
- Ergonomic workspaces — to reduce strain and support long-term mobility
- Nutritious eating — not just for weight management, but for cognition and inflammation control
- Sleep routines — that restore your brain and body for the day ahead
- Social connections — which boost emotional health and reduce the risk of cognitive decline
Retirement Looks Different Now — And That’s a Good Thing
There’s no single formula that works for everyone. Retirement has shifted from a fixed destination to a fluid stage of life — one that may include part-time work, caregiving, or travel. Alternative investments reflect that reality by offering more flexibility and control than traditional options alone.
A 60/40 portfolio still has value, but it may not cover every need. Alternative assets can add depth and resilience to your retirement strategy — especially if you’re thinking beyond simple growth targets.
It’s about giving yourself more ways to prepare, and more confidence in your future. If you’re ready to build a plan that goes further than the basics, it may be time to reconsider what your portfolio — and your retirement — could look like.
Related Articles:
– 10 Things to Know Before You Retire
– How to Diversify Your Retirement Portfolio Beyond Traditional Investments
– Best Investment Strategies to Try in 2025
– Effective Tax Management: A Guide for Freelancers and Small Businesses
– 7 Tips for Moms Launching Their Own Online Businesses
– 8 Tips for Choosing a Savings Account for Your Family’s Needs
– Is Leveraging a Property Portfolio a Good Idea for Long-Term Financial Goals?
