U.S. State Pension Plans Funding Status – First Quarter 2023

Wilshire estimates almost 3% increase in the aggregate funded ratio for U.S. state pension plans in the first quarter of 2023

Santa Monica, Calif., April 19, 2023 – The aggregate funded ratio for U.S. state pension plans increased by an estimated 2.8% during the first quarter of 2023 to end the quarter at 76.4%, according to Wilshire, a diversified global financial services firm. Through its suite of Outsourced Chief Investment Officer (OCIO) and advisory services, Wilshire assists in providing secure and safe retirements for millions of Americans, including those participating in some of the nation’s largest corporate and public retirement plans.

The quarterly change in funding resulted from a 4.7% increase in asset value partially offset by a 0.9% increase in liability value. Although the aggregate funded ratio is estimated to have increased by 2.8% during the first quarter, it is estimated to have decreased by 5.2% over the trailing twelvemonths.

“The aggregate funded status increased during the first quarter despite the panic spurred by the regional bank crisis in the United States and the Credit Suisse and UBS merger in Switzerland with positive quarterly returns for most asset classes,” stated Ned McGuire, Managing Director, Wilshire. “The first quarter of 2023 marks the second consecutive quarter of funded status increases.” 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 2023 state funding study. The funded ratio is based on liabilities, service cost, benefit payments and contributions in line with Wilshire’s 2023 state funding study.

The assumed asset allocation is below:

About Wilshire

Wilshire is a global provider of market-leading indexes, advanced analytics, and multi-asset investment solutions. A trusted partner to a diverse range of more than 500 leading institutional investors and financial intermediaries, our clients rely on us to improve investment outcomes for a better future. Wilshire advises on over $1.3 trillion in assets and manages $83 billion in assets and is headquartered in the United States with offices worldwide.

More information on Wilshire can be found at www.wilshire.com

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