Articles | July 26, 2022

Model Pension Plan’s Funded Status Dips Slightly

During the second quarter of 2022, the funded status of the model pension plan examined in each issue of Prism fell by 2 percentage points, to 100 percent, as illustrated in the graph below.

This decrease in funded status is primarily attributable to a 13 percent decrease in assets, partially offset by a 12 percent decrease in liabilities.

Get the Publication

Model Pension Plan’s Funded Status Dips Slightly Download Now

Changes in Assets Liabilities and Funded Ratio 

Aspects of investment performance that contributed to the decrease in funded status

Equity and fixed income returns were again very poor across the board during Q2 as first-quarter losses accelerated into Q2.

U.S. equity markets entered bear market territory and are now more than 20 percent off their recent highs. Developed international and emerging market equities also performed very poorly but outperformed the U.S.

Fixed income returns were also poor again this quarter, both domestically and internationally, as interest rates continue their upward trajectory.

Examine your own DB plan’s experience

Plan sponsors should examine changes in their own DB plans’ assets, liabilities and funded ratios from the vantage point of both accounting and funding metrics.

We can help employers project their DB plans’ funded ratios with a complete view of the range of a plan’s possible future statuses, presenting early warning signs of potential challenges.

Start a Conversation

See more insights

Man Examining Data

Model Pension Plan's Funded Status Rises

The latest edition of Prism examines changes to our model pension plan funded status in Q1 2022.
Colleagues Having Conversation

Model Pension Plan Ends 2021 Fully Funded

The latest edition of Prism examines changes to our model pension plan funded status in Q4 2021.
Man Working On A Computer

Pension Plan Funded Status Drops Slightly as Assets Dip

The latest edition of Prism examines changes to our model pension plan funded status in Q3 2021.

Segal Marco Advisors provides consulting advice on asset allocation, investment strategy, manager searches, performance measurement and related issues. The information and opinions herein provided by third parties have been obtained from sources believed to be reliable, but accuracy and completeness cannot be guaranteed. This article and the data and analysis herein is intended for general education only and not as investment advice. It is not intended for use as a basis for investment decisions, nor should it be construed as advice designed to meet the needs of any particular investor. Please contact Segal Marco Advisors or another qualified investment professional for advice regarding the evaluation of any specific information, opinion, advice, or other content. Of course, on all matters involving legal interpretations and regulatory issues, investors should consult legal counsel.

Don't miss out. Join 16,000 others who already get the latest insights from Segal.