Last year, investment returns for public pension systems hit record highs. The median return for state-managed plans was 27% in 2021. Despite beating investment return targets by 20% in 2021, many public pension plans are now taking the opportunity to reduce their investment risks by lowering investment return rate assumptions to more realistic long-term growth rates.
Using the latest capital market assumptions from established financial firms, Reason Foundation’s Pension Integrity Project built a portfolio simulation tool, which gives an idea of the range of returns that financial experts are expecting for pension funds for the next few decades. For a portfolio