Public Pension Funded Ratio Drops to 83.7% in March Amid Market Turmoil
Event summary
- Milliman's Public Pension Funding Index (PPFI) shows a decline in the funded ratio of the nation’s 100 largest public defined benefit plans from 87.0% to 83.7% in March 2026.
- The drop is attributed to market downturns caused by Middle East conflict, resulting in an estimated $208 billion loss in assets.
- Aggregate returns for the plans were -3.5% in March, the first monthly decline since March 2025.
- As of March 31, 2026, PPFI plan assets stood at $5.726 trillion while liabilities rose to $6.843 trillion.
The big picture
The decline in public pension funding ratios highlights the vulnerability of these plans to market volatility, particularly amid geopolitical conflicts. This drop comes after a period of relative stability and underscores the need for robust risk management strategies in public pension governance. The overall health of the plans remains a critical focus for policymakers and financial analysts.
What we're watching
- Market Volatility Impact
- How sustained geopolitical tensions will affect public pension funding stability.
- Funding Recovery Pace
- The pace at which the funded ratio can rebound following market downturns.
- Plan Health Dynamics
- Whether the number of plans below 60% funded remains stable or deteriorates further.