The funded status of the 100 largest corporate defined benefit pension plans improved by $3 billion during June as measured by the Milliman 100 Pension Funding Index (PFI). A decrease in the benchmark corporate bond interest rates resulted in a $24 billion increase in pension liabilities; however, pension assets increased on the same order due to strong investment returns. As a result of the offsetting pension liability and asset growth, the funded status ratio had a modest increase to 105.1%. The mid-year funded ratio is well ahead of the 103.6% funded ratio seen at the start of 2025 and is the highest since October 2022.
The market value of assets increased by $27 billion because of June’s robust 2.63% investment return. The Milliman 100 PFI asset value rose to $1.281 trillion as of June 30, 2025, from $1.254 trillion as of May 31, 2025. By comparison, the 2025 Milliman Pension Funding Study reported that the monthly expected investment return for FY2024 was 0.53% (6.53% annualized). The full results of the annual 2025 study can be found at www.milliman.com/pfs.
The Milliman 100 PFI projected benefit obligation (PBO) increased to $1.219 trillion from $1.195 trillion during June. The change resulted from a 19 basis point decrease in the monthly discount rate, to 5.52% for June from 5.71% in May. June’s discount rate is seven basis points lower than the 5.59% discount rate seen at the start of 2025.
Highlights
| $ BILLION | FUNDED PERCENTAGE | |||
|---|---|---|---|---|
| MV | PBO | FUNDED STATUS | ||
| May | 1,254 | 1,195 | 59 | 104.9% |
| June | 1,281 | 1,219 | 62 | 105.1% |
| Monthly change | +27 | +24 | +3 | 0.2% |
| YTD Change | +17 | (1) | +18 | 1.5% |
Note: Numbers may not add up precisely due to rounding
Second quarter 2025 summary
The quarter ending June 30, 2025 was a win-win for corporate pensions from both sides of the balance sheet. Plan assets grew by $23 billion while plan liabilities dropped by $6 billion. The investment return was a robust 3.42% during the second quarter and had a significant impact on the funded status improvement. Discount rates climbed just two basis points and contributed to the funding improvement, albeit to a lesser extent. The net balance sheet impact was a funded status improvement of $29 billion. The funded status surplus grew to $62 billion by the end of the second quarter. The funded ratio of the Milliman 100 companies increased to 105.1% at the end of June from 102.6% at the end of March.
Over the last 12 months (July 2024 – June 2025), the cumulative asset return for these plans was 7.71% and the Milliman 100 PFI funded status position improved by $25 billion. The funded status increase was the result of positive market returns and discount rate increases. Discount rates experienced a net increase of six basis points to 5.52% from 5.46% one year ago. The funded ratio of the Milliman 100 companies has improved over the past 12 months, to 105.1% from 102.9%.
Figure 1: Milliman 100 Pension Funding Index — Pension surplus/deficit
Figure 2: Milliman 100 Pension Funding Index — Pension funded ratio
2025-2026 projections
If the Milliman 100 PFI companies were to achieve the expected 6.53% median asset return (as per the 2025 PFS), and if the current discount rate of 5.52% remains unchanged throughout 2025 and 2026, we forecast that the funded status of the surveyed plans would increase. The pension surplus is projected to be $71 billion (funded ratio of 105.9%) by the end of 2025 and $91 billion (funded ratio of 107.6%) by the end of 2026. For purposes of this forecast, we have assumed 2025 and 2026 aggregate annual contributions of $20 billion.
Under an optimistic forecast with rising interest rates (reaching 5.82% by the end of 2025 and 6.42% by the end of 2026) and annual asset returns of 10.53%, the funded ratio is projected to climb to 111% by the end of 2025 and 125% by the end of 2026. Under a pessimistic forecast with similar interest rate and asset movements (5.22% discount rate at the end of 2025 and 4.62% by the end of 2026 and 2.53% annual asset returns), the funded ratio is projected to decline to 101% by the end of 2025 and 92% by the end of 2026.
Milliman 100 Pension Funding Index - July 2025 (all dollar amounts in millions)
Pension asset and liability returns
About the Milliman 100 monthly Pension Funding Index
For the past 25 years, Milliman has conducted an annual study of the 100 largest defined benefit pension plans sponsored by U.S. public companies. The Milliman 100 Pension Funding Index projects the funded status for pension plans included in our study, reflecting the impact of market returns and interest rate changes on pension funded status, utilizing the actual reported asset values, liabilities, and asset allocations of the companies’ pension plans.
The results of the Milliman 100 Pension Funding Index were based on the actual pension plan accounting information disclosed in the footnotes to the companies’ annual reports for the 2024 fiscal year and for previous fiscal years. This pension plan accounting disclosure information was summarized as part of the Milliman 2025 Pension Funding Study, which was published on April 30, 2025. In addition to providing the financial information on the funded status of U.S. qualified pension plans, the footnotes may also include figures for the companies’ nonqualified and foreign plans, both of which are often unfunded or subject to different funding standards than those for U.S. qualified pension plans. They do not represent the funded status of the companies’ U.S. qualified pension plans under ERISA.