Private Credit
Terry,
We listen to you on the radio and on your site, and read the columns you publish. Your July 13 2025 column about private equity investments makes them sound horrible – and I believe you discussed this also with John Williams.
Is this the same as Private Credit. It sounds like it could be. Our fiduciary (Mariner) is suggesting we invest in Private Credit, knowing these funds would be illiquid (this would be quarterly). Specifically we would choose BCRED through Blackrock.
We are in early retirement and very lucky to have 9 million is equity. We don’t spend extravagantly, and we understand there is a risk with everything, but is it true that this would be a safer bet against markets falling?
Any advice is so appreciated!
Terry Says
Eek, that depends on the exact private credit market product. I’m just personally a bit squeamish. Typically, these offerings do not give buyers the best deal or best return vs risk of investment. Illiquid is only one problem. Valuation is the second. If you want to get out, there may be NO bid. And you may find the previous “valuation” was highly overpriced when there is no bid to hit.
Private credit offers higher yields because there is higher risk. These borrowers are willing to pay higher rates because they can’t get the credit from traditional institutions, or would have to pay an even higher rate. And the fees paid to the salespeople who sell this stuff take away from the higher yield you should be getting for this additional risk.
Sounds like you have plenty of money to speculate. But this wouldn’t be my place to do it. Maybe consider a review by a fee-only FIDUCIARY planner who isn’t trying to sell you anything! Check this out: https://www.terrysavage.com/pam-krueger-wealthramp/
