Corporate DB Pension Funding Levels Down Nine Percentage Points

One effect of the 2013 bull market was that it left defined benefit corporate pensions in the best financial shape in years, but by the end of 2014 those gains had already started to decline with aggregate funding dropping nine percentage points, reports consulting firm Towers Watson.

“Despite a rising stock market in 2014, funding levels for employer-sponsored pension plans dropped back to what we experienced just after the financial crisis,” said Alan Glickstein, a senior retirement consultant at Towers Watson. “A one-time strengthening of mortality assumptions alone is responsible for about 40% of the increased deficit.”

Total funding deficit more than doubled...

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