Sibson Consulting and Segal Marco Advisors’ Pension Funding Tracker Shows Another Funding Increase

Sibson Consulting and Segal Marco Advisors’ Pension Funding Tracker Shows Another Funding Increase

The funded status of the model pension plan examined by Sibson Consulting and Segal Marco Advisors rose again by 2 percentage points to 93 percent in the second quarter of 2018, as illustrated in the graph below. The funding increase is a result of a flat asset return combined with a 3 percent decrease in liabilities. The decrease in liabilities was due to an increase in high-quality corporate yields.

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“Domestic stocks were the lone bright spot, posting positive returns each month of Q2, and outperforming developed international stocks and emerging market stocks,” said David Palmerino, vice president with Segal Marco Advisors. He added, “FOMC increased the target range for the Federal Funds Rate to 2 percent, its second increase this year, but the move was largely telegraphed and had no dramatic impact on bond prices.”

National Retirement Practice Leader Stewart Lawrence advised, .“As employers reconsider their strategies and tactics for 2018, this might be an appropriate time to raise the issue of examining their plans’ evolving risk-mitigation strategy.”

To speak with one of our consultants about the model plan, and how it may inform decision-making for employers that have a pension plan, please contact Erin Burns.

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Segal Marco Advisors (www.segalmarco.com), a member of The Segal Group, provides innovative, client-driven consulting advice, outsourcing solutions, proxy voting and corporate governance. Clients include joint boards of trustees administering benefit plans under the Taft-Hartley Act, state and local governments, corporations, non-profit organizations, endowments and foundations. The firm works with financial services firms through Rogerscasey, a Division of Segal Advisors, and with Canadian clients through Segal Rogerscasey Canada.

 

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The Segal Group (www.segalgroup.net) is a privately owned benefits, compensation and investment-consulting firm with more than 1,000 employees throughout the U.S. and Canada. Members of The Segal Group include: Segal Consulting, Sibson Consulting, Segal Select Insurance Services, Inc. and Segal Marco Advisors.