Funded status of largest US corporate pension plans now well over 100% for year-end 2025

Rhea-AI Summary

WTW (NASDAQ: WTW) analysis finds the aggregate funded status of 349 large U.S. corporate defined benefit pension plans rose to an estimated 104% at year-end 2025, up from 101% at year-end 2024.

Key figures: pension obligations fell to an estimated $1.11 trillion from $1.16 trillion; plan assets finished near $1.16 trillion; and overall investment returns averaged an estimated 11% in 2025.

WTW attributes the improvement primarily to strong market returns (large-cap equities +18%, small/mid-cap +12%) with interest rates broadly stable; the firm notes a persistent split between well-funded plans (growing surplus) and underfunded plans that may still face required contributions and funding challenges in 2026.

Positive

• Aggregate funded status improved to 104% at year-end 2025
• Overall pension plan assets ended at $1.16 trillion in 2025
• Estimated investment returns averaged 11% in 2025

Negative

• Aggregate pension obligations only modestly declined to $1.11 trillion
• Underfunded plans remain and may face required contributions or funding pressure in 2026

Key Figures

2025 funded status 104% Aggregate funded status of largest U.S. DB pension plans at end of 2025

2024 funded status 101% Aggregate funded status of largest U.S. DB pension plans at end of 2024

2024 pension obligations $1.16 trillion Aggregate pension obligations at end of 2024

2025 pension obligations $1.11 trillion Estimated aggregate pension obligations at end of 2025

2025 pension assets $1.16 trillion Estimated aggregate assets of analyzed DB plans in 2025

Overall 2025 return 11% Estimated average investment return for pension assets in 2025

Large-cap equity return 18% Domestic large capitalization equity performance in 2025

Long corporate bond return 8% Long corporate bond performance used in liability-driven strategies in 2025

Market Reality Check

$336.10 Last Close

Volume Volume 399,732 is below the 20-day average of 646,376, suggesting muted trading interest ahead of this update. low

Technical Price at $326.27 is trading above the 200-day MA of $321.31, indicating a pre-news uptrend bias.

Peers on Argus

WTW slipped 0.71% while key brokers like BRO (-2.7%), ERIE (-2.52%), AON (-1.95%), and MMC (-1.05%) also traded lower, pointing to broader weakness but with WTW holding up relatively better.

Historical Context

Date	Event	Sentiment	Move	Catalyst
Dec 15	Debt offering	Neutral	-0.3%	Registered offering of senior unsecured notes for refinancing and acquisition funding.
Dec 15	Pricing report	Positive	+1.2%	Report showing moderating U.S. commercial insurance pricing trends versus prior-year levels.
Dec 11	Risk index report	Neutral	+3.4%	Political Risk Index outlining how new tariff deals reshape trade and security alignment.
Dec 10	M&A – Cushon	Positive	-2.2%	Agreement to acquire UK fintech pensions and savings provider Cushon to grow DC master trust.
Dec 10	M&A – Newfront	Positive	-2.2%	Agreement to acquire Newfront for up to $1.3B, adding producers and AI-driven technology.

Pattern Detected

Recent news shows mixed alignment: macro/industry reports often saw positive alignment, while strategic acquisitions tended to face negative price reactions.

Recent Company History

Over the last month, WTW has announced several strategic and financing actions. In December 2025, it priced $1,000,000,000 in senior notes and filed related 8-K and 424B2 documents tied to the planned Newfront acquisition. It also reported moderating U.S. commercial insurance pricing and published a Political Risk Index on shifting tariff-driven geopolitics. Acquisitions of Newfront and UK pensions provider Cushon were announced on December 10, 2025. The current pension-funded-status analysis continues WTW’s role as a provider of advisory insights to corporates.

Market Pulse Summary

This announcement highlights that large U.S. corporate defined benefit plans reached an estimated funded status of 104% for year-end 2025, with obligations easing to about $1.11 trillion and assets near $1.16 trillion. Estimated investment returns of 11%, including 18% from domestic large caps and solid long-bond gains, underpin the improvement. For WTW, it underscores its advisory role in pensions and risk, while plan sponsors face ongoing choices around surplus deployment, funding, and investment strategy in 2026.

Key Terms

defined benefit (db) pension plans financial

"the nation’s largest corporate defined benefit (DB) pension plans improved significantly in 2025"

A defined benefit (DB) pension plan is a retirement program that promises employees a specific monthly payment in retirement, usually based on salary and years of service, so the employer is responsible for making sure the money is there. Investors care because those promised future payments are a firm obligation — like a fixed bill the company must pay — which can affect cash flow, borrowing needs, financial health and ultimately shareholder value.

pension funded status financial

"The aggregate pension funded status of these plans at the end of 2025 is estimated to be 104%"

The pension funded status measures whether a company has set aside enough assets to cover the retirement payments it has promised to employees — like comparing a household’s savings to its future bills. Investors care because a shortfall can force a company to make large cash contributions, hurt free cash flow, increase financial risk and borrowing costs, and create uncertainty about earnings or dividend capacity.

liability-driven investing financial

"Long corporate and long government bonds, typically used in liability-driven investing strategies, realized gains"

Liability-driven investing is an approach that structures a portfolio to produce the cash flows and risk profile needed to meet known future payments or obligations, such as pensions or insurance claims. It matters to investors because it prioritizes making sure those bills can be paid over chasing higher returns, reducing the chance that market swings leave a shortfall—think of it like setting aside specific envelopes to cover future bills rather than hoping extra savings will appear.

AI-generated analysis. Not financial advice.

Funded status of largest plans shows strong improvement to 104%, WTW analysis finds

NEW YORK, Jan. 05, 2026 (GLOBE NEWSWIRE) -- The funded status of the nation’s largest corporate defined benefit (DB) pension plans improved significantly in 2025, according to an analysis by WTW (NASDAQ: WTW), a leading global advisory, broking and solutions company.

WTW examined pension plan data for 349 Fortune 1000 companies that sponsor U.S. DB pension plans and have a December fiscal year-end date. The aggregate pension funded status of these plans at the end of 2025 is estimated to be 104%, an increase from 101% at the end of 2024. Pension obligations declined slightly from $1.16 trillion at the end of 2024 to an estimated $1.11 trillion at the end of 2025.

Fortune 1000 aggregate pension plan funding levels

Year	2008		2009		2010		2011		2012		2013		2014		2015		2016		2017		2018		2019		2020		2021		2022		2023		2024		2025*
Aggregate level	77%		81%		84%		78%		77%		89%		81%		81%		81%		85%		86%		87%		88%		95%		98%		98%		101%		104%

*Estimated

“In 2025, the primary driver of improved funded statuses has been strong market returns, with interest rates remaining relatively stable and having minimal impact on pension liabilities,” said Jonathan Sterbanz, senior director, Retirement, WTW. “Although plan sponsors have taken many steps to reduce funded status risk, they are still positioned to benefit from strong market performance, particularly as more plans move into a surplus position. This positions these plan sponsors to consider their options for deploying that surplus.”

According to the analysis, pension plan assets remained strong in 2025, finishing the year at $1.16 trillion. Overall investment returns are estimated to have averaged 11% in 2025, although returns varied significantly by asset class. Domestic large capitalization equities increased by 18%, while domestic small/mid-capitalization equities rose by 12%. Long corporate and long government bonds, typically used in liability-driven investing strategies, realized gains of 8% and 6%, respectively.

“Despite the significant improvement in aggregate funded status in 2025, there remains a divide between well-funded and underfunded plans. While there has been a significant increase in surplus for well-funded plans, it has been more challenging for the funded status of underfunded plans to improve. Sponsors whose plans aren’t fully funded will want to monitor the potential for required contributions, perhaps getting ahead with planned funding, and examining their investment strategy while being mindful of short-term volatility. Ultimately, taking a holistic approach – combining investment, funding and risk transfer actions – will be prudent in 2026,” said Fred Lamm, managing director, Retirement, WTW.

About the analysis

WTW analyzed 349 Fortune 1000 companies with December fiscal year-end dates for which complete data were available. The 2025 figures are estimates of U.S. plan assets and liabilities. The earlier figures are actual. Actual year-end 2025 results will be publicly available in a few months.

About WTW

At WTW (NASDAQ: WTW), we provide data-driven, insight-led solutions in the areas of people, risk and capital. Leveraging the global view and local expertise of our colleagues serving 140 countries and markets, we help organizations sharpen their strategy, enhance organizational resilience, motivate their workforce and maximize performance.

Working shoulder to shoulder with our clients, we uncover opportunities for sustainable success—and provide perspective that moves you. Learn more at wtwco.com.

Media contacts

Ileana Feoli: +1 212 309 5504
ileana.feoli@wtwco.com

Stacy Bronstein:
sbronstein@meritcomms.com

FAQ

What did WTW report about corporate pension funded status for year-end 2025 for WTW (NASDAQ: WTW)?

WTW reported an estimated aggregate funded status of 104% at year-end 2025 for 349 Fortune 1000 corporate DB plans, up from 101% at year-end 2024.

How did pension assets and obligations change in 2025 according to WTW's analysis?

WTW estimates plan assets finished near $1.16 trillion in 2025 while pension obligations declined to an estimated $1.11 trillion.

What investment returns drove the improved funded status in 2025 per WTW?

WTW estimates overall returns averaged 11% in 2025, with domestic large-cap equities up 18% and small/mid-cap up 12%.

Does WTW expect underfunded plans to improve after the 2025 results?

WTW notes underfunded plans have found it more challenging to improve and may need to monitor or accelerate funding and revisit investment strategy in 2026.

What risk factors did WTW highlight for corporate pension sponsors heading into 2026?

WTW highlighted short-term market volatility, potential required contributions for underfunded plans, and the need to combine investment, funding and risk transfer actions.