How to Invest in Private Equity as an Individual (2026)

You can invest in private equity without being rich through listed PE firms and trusts (KKR, Blackstone, 3i, Pantheon International), PE ETFs, and some interval or evergreen funds with $25,000 minimums. Direct funds and most private deals are limited to accredited investors: in the US, $200,000 of income ($300,000 with a partner) or $1 million of net worth excluding your home. Expect higher fees, limits on selling, and returns that recently trailed the stock market.

Private equity is sold to ordinary investors as the club the rich have always been in. Some of that is true. Pension funds and family offices have held private equity for decades, and the rules kept most people out.

The rules are loosening, slowly. That makes it more important to know what you would be buying: a fee structure built for institutions, money you may not be able to take out when you want it, and a recent record that is less impressive than the marketing.

How do private equity funds charge investors?

The classic structure is "2 and 20". The SEC describes it as a yearly management fee on committed or invested capital, for example 2%, plus a performance fee based on the profits made above a certain benchmark, for example 20%, which is called carried interest. A CFA Institute Research Foundation review adds that the carry often sits behind "an 8% hurdle before the GP is eligible to receive carried interest".

Funds built for individuals use lower headline rates, plus distribution costs. Blackstone's international private equity fund for individual investors, BXPE, lists a 1.25% management fee and a 12.5% performance fee above a 5% hurdle, plus up to 0.85% a year in servicing fees on one share class.

Can you invest in private equity if you are not accredited?

Yes, through these routes. Each is a different trade-off.

Listed firms are a bet on the managers, who earn fees and carry, more than on the companies they own. Listed trusts own the companies or funds directly, which is closer to private equity itself. Their shares often trade at a discount: the AIC private equity sector averaged a discount of about 26% in mid-2026, and 3i's shares were 23% below its last published net asset value on October 20, 2026, after falling 44% in a year. A discount can be a bargain or a sign the market doubts the valuations.

ETFs hold baskets of listed PE firms and trusts. Invesco's PSP charges 1.75% a year and returned 7.1% a year over the 10 years to September 30, 2026. ProShares' PEX shows a net expense ratio of 2.75% once the fees of the funds it holds are included, and returned 4.59% a year over the same decade.

Interval funds buy back shares only at set intervals. The SEC says they repurchase 5% to 25% of outstanding shares in each offer, "every three, six, or twelve months", and if more investors want out, everyone gets a pro rata share. The Federal Reserve notes that interval funds hold mostly private credit, with only about 5.8% in private equity, so check what a fund owns before assuming it is a PE fund.

What do you need to be an accredited investor?

In the US, the SEC's definition for individuals includes:

• Net worth over $1 million, excluding your primary residence, alone or with a spouse or partner, or
• Income over $200,000 (or $300,000 with a spouse or partner) in each of the past two years, with the same expected this year, or
• Holding a Series 7, 65 or 82 licence in good standing.

Accredited investors can buy tender-offer and evergreen PE funds, which the Fed describes as generally limited to accredited investors or qualified clients. Minimums are often around $25,000: BXPE's international terms list $25,000. Hamilton Lane's Private Assets Fund, for example, is sold to "qualified clients" and its adviser recommends repurchase offers of no more than 5% of net assets each quarter.

Changes in progress. On September 30, 2026 the SEC sought comment on new ways to qualify, including passing a FINRA accredited investor exam or holding a CPA, CFA or CFP. Morrison Foerster notes these are notices, and nothing is effective until the SEC issues orders. The INVEST Act, which would add similar routes, passed the House in December 2025 and is waiting in the Senate. Neither is law yet.

Can private equity go in your 401(k)?

Not widely yet. An August 2025 executive order told the Labor Department to revisit its guidance on alternative assets in 401(k) plans, including private equity. The department rescinded its 2021 cautionary statement on August 12, 2025, and in March 2026 proposed a rule telling plan fiduciaries to weigh performance, fees, liquidity and valuation. As of October 2026 the rule is still a proposal.

How do Europe, the UK and Singapore handle it?

European Union. The revised ELTIF rules (Regulation (EU) 2023/606) have applied since January 10, 2024. They removed the old €10,000 minimum and the 10% portfolio cap for retail investors, according to the French asset managers' association, and allow an optional liquidity window.

United Kingdom. The Long-Term Asset Fund is an open-ended fund the FCA introduced in 2021 to hold long-term, illiquid assets such as private equity. It must hold at least 50% in illiquid assets, and it can only be sold to retail investors with risk warnings and an assessment. Listed trusts on the London Stock Exchange remain the simplest route.

Singapore. MAS proposed a Long-term Investment Fund framework for retail investors in March 2025. We could not find a final version as of October 2026.

What about equity crowdfunding?

Crowdfunding lets anyone buy small stakes in private companies, usually start-ups. In the US, Regulation Crowdfunding caps what a company can raise at $5 million in 12 months. If your income or net worth is under $124,000, you can invest the greater of $2,500 or 5% of the larger of the two each year; above that, 10%, with a $124,000 overall cap. Shares generally cannot be resold for a year.

The businesses are tiny. The SEC found the median Reg CF issuer had about $80,000 in total assets, $10,000 in revenue and three employees. In the UK, Beauhurst found just 6% of crowdfunding rounds from 2011 to 2021 went to companies that later exited, against 11% of venture rounds, and 20% went to companies that have since gone under. This is closer to angel investing than to private equity; our angel investing guide covers the odds.

Has private equity beaten the stock market?

Over long periods, mostly yes, though by less than the marketing implies and with debate about risk. The CFA Institute review says the academic consensus is that PE funds "have historically yielded returns after fees that exceed those on the S&P 500", and that whether this is true risk-adjusted outperformance "remains elusive."

Recently it has lagged. McKinsey reports that in 2025 top-quartile buyout returns averaged 8%, less than half of the S&P 500's 18%. Bain says the public market run-up has erased the historical gap in 10-year returns between public and private equity in the US. Meanwhile funds are struggling to sell companies: Bain counts 32,000 unsold companies worth $3.8 trillion, which is why investors in some funds are waiting longer for their money back.

Who should invest in private equity, and how much?

It suits investors who already have an emergency fund, a pension, and a diversified portfolio of low-cost index funds, and who can leave a small slice untouched for 10 years. The index investing guide is the place to start if you do not have that core yet.

It does not suit money you might need within a few years, anyone paying high-interest debt, or anyone buying because the brochure says "what the billionaires own". A household that copies family office allocations through high-fee products usually gets the fees without the access.

If you want private equity returns with your own effort rather than a fund's, the rest of this series covers buying a small business yourself. The hub at how to do private equity explains how the funds you would be investing in actually work.

This is general information, not financial, legal or tax advice. Fund terms, fees and rules change, past returns do not predict future ones, and you should read a fund's prospectus and consider a fee-only adviser before investing.