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.

“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.

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