U.S. State Pension Plans Funding Status – First Quarter 2025

Santa Monica, Calif., May 7, 2025 — The aggregate funded ratio for U.S. state pension plans decreased by an estimated 0.8 percentage points during the first quarter of 2025 to end the quarter at 78.6%, according to Wilshire, a diversified global financial services firm. Wilshire assists in providing a suite of OCIO and advisory services to some of the nation’s largest retirement plans which help fund the retirement of millions of Americans.

The quarterly change in funding resulted from a 0.3% decrease in asset value and a 0.7% increase in liability value. The aggregate funded ratio is estimated to have decreased by 0.3% over the trailing twelve months.

"The aggregate funded status decreased this quarter due to a decline in asset values. The FT Wilshire 5000 Index^SM experienced in March its worst monthly performance since September 2022, with U.S. equity, as measured by the index, down 4.8% in the first quarter," stated Ned McGuire, Managing Director at Wilshire. "This quarter's decrease marked the second consecutive decline in the funded ratio of U.S. State Pension Plans, pulling them back below the 80% threshold," Mr. McGuire added.

A 12-month review of the funded ratio follows:

The aggregate figures represent an estimate of the combined assets and liabilities of state pension plans included in Wilshire’s 2025 state funding study. The funded ratio is based on liabilities, service cost, benefit payments and contributions in line with Wilshire’s 2025 state funding study.

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The Data

Wilshire’s practice is to collect data on public pension plans from Annual Comprehensive Financial Reports (ACFR) filings as of their fiscal year-end (FYE). All data for fiscal year 2024 is based on the 241 constituents in Wilshire State and City & County pension plans that maintain defined benefit pension plans as of year-end 2023. The estimated monthly funded ratios are based on liabilities, service cost, benefit payments and contributions in line with Wilshire’s 2024 State and City & County funding studies.

The assumed asset allocation is below:

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About Wilshire

Wilshire is a leading global financial services firm and trusted partner to a diverse range of approximately 300 leading institutional investors and financial intermediaries. Our clients rely on us to improve investment outcomes for a better future¹. Wilshire advises on over $1.5 trillion in assets and manages $123 billion in assets as of December 31, 2024². Wilshire is headquartered in the United States with offices worldwide. More information on Wilshire can be found at www.wilshire.com.

¹ Includes institutional investors, financial intermediaries, and Wilshire-sponsored vehicles. Does not include individual retirement plans and retail investors via financial intermediary platforms.

² Assets under advisement refers to the total amount of assets (inclusive of assets under management) attributable to all of Wilshire’s advisory relationships, including various consulting and advisory relationships for which Wilshire provides investment advisory services without engaging, on either a discretionary or non-discretionary basis, in the direct management of a client’s portfolio. Assets under management refers to the amount of assets attributable to securities portfolios for which Wilshire provides discretionary and non-discretionary asset management services and is calculated differently than “regulatory assets under management.”

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Index Definitions

FT Wilshire US 5000 Index^SM

The FT Wilshire US 5000 Index^SM is a broad-based market capitalization-weighted index that aims to capture 100% of the U.S. investible market capitalization.

MSCI ACWI ex USA ($) Index

The MSCI ACWI ex USA Index captures large- and mid-cap representation across developed markets countries (excluding the United States) and emerging markets countries. The index covers approximately 85% of the global equity opportunity set outside the United States.

Bloomberg U.S. Aggregate Index

The Bloomberg U.S. Aggregate Index represents securities that are SEC-registered, taxable, and dollar denominated. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through securities, and asset-backed securities.

NCREIF ODCE Fund Index

The NFI-ODCE (NCREIF Fund Index - Open-End Diversified Core Equity) is a fund-level capitalization weighted, time-weighted return index and includes property investments at ownership share, cash balances and leverage (i.e., returns reflect the fund's actual asset ownership positions and financing strategy).

Bloomberg U.S. Treasury Bills

The Bloomberg US Treasury Bill Index tracks the market for treasury bills issued by the US government. US Treasury bills are issued in fixed maturity terms of 4, 8, 13, 17, 26 and 52 weeks.

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Important Information

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