S&P 1500 pension funded status decreased by three percent in March
The estimated aggregate funding level of pension plans sponsored by S&P 1500 companies decreased by three percent in March 2026 to 104 percent as a result of a decrease in equity returns partially offset by an increase in discount rates. As of March 31, 2026, the estimated aggregate surplus of $65 billion USD decreased by $46 billion USD compared to a surplus of $111 billion USD measured at the end of February, according to Mercer, a business of Marsh.
“Pension funded status for the S&P 1500 fell 3% in March as equities tumbled,” said Matt McDaniel, a Partner in Mercer’s Wealth Practice. “Equities fell throughout the month as the Middle East conflict led to a sharp rise in oil prices, however, interest rates bounced back to help soften the blow to pension funded status.”
“We have seen heightened market volatility as a result of the ongoing conflict, paired with uncertainty around when it may end, and the ultimate impact on nagging inflation,” McDaniel continued.
The S&P 500 index decreased 5.09% percent and the MSCI EAFE index decreased 10.73% percent in March. Typical discount rates for pension plans, as measured by the Mercer Yield Curve, increased from 5.33 percent to 5.65 percent.
“Volatility in the equity and bond markets directly impacts pension funded status, placing plan sponsors in a difficult position. With no clear timeline for an end to the conflict, plan sponsors should continue to monitor the situation and ensure they are well positioned for a potentially lengthy period of elevated volatility,” McDaniel added.
Mercer estimates the aggregate funded status position of plans sponsored by S&P 1500 companies on a monthly basis. Figure 1 (below) shows the estimated aggregate surplus/(deficit) position and the funded status of all plans sponsored by companies in the S&P 1500. The estimates are based on each company’s latest available year-end statement and by projections to March 31, 2026, in line with financial indices. The estimates include U.S. domestic qualified and non-qualified plans, along with all non-domestic plans. The estimated aggregate value of pension plan assets of the S&P 1500 companies as of February 28, 2026, was $1.68 trillion USD, compared with estimated aggregate liabilities of $1.57 trillion USD. Allowing for changes in financial markets through March 31, 2026, changes to the S&P 1500 constituents, and newly released financial disclosures at the end of February, the estimated aggregate assets were $1.58 trillion USD, compared with the estimated aggregate liabilities of $1.52 trillion USD. Figure 2 shows the discount rates used in Mercer’s pension funding calculation.
Notes for editors
Information on the Mercer Yield Curve is available at Pension Discount Yield Curve and Index Rates in US.
The Mercer US Pension Buyout Index may be accessed at Mercer US pension buyout index.
Unless otherwise stated, the calculations are based on the Financial Accounting Standard (FAS) funding position and include analysis of the S&P 1500 companies.
1 Figures provided by Mercer Investments LLC.
2 Source of financial statement data: Standard & Poor’s Capital IQ. Standard and Poor’s is a division of The McGraw-Hill Companies, Inc. This may contain information obtained from third parties, including ratings from credit ratings agencies such as Standard & Poor’s. Reproduction and distribution of third party content in any form is prohibited except with the prior written permission of the related third party. Third party content providers do not guarantee the accuracy, completeness, timeliness or availability of any information, including ratings, and are not responsible for any errors or omissions (negligent or otherwise), regardless of the cause, or for the results obtained from the use of such content. THIRD PARTY CONTENT PROVIDERS GIVE NO EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO, ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE. THIRD PARTY CONTENT PROVIDERS shall not be liable for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including lost income or profits and opportunity costs) in connection with any use of THEIR CONTENT, INCLUDING ratings. Credit ratings are statements of opinions and are not statements of fact or recommendations to purchase, hold, or sell securities. They do not address the suitability of securities or the suitability of securities for investment purposes, and should not be relied on as investment advice.