Welcome to the latest edition of This Week in Pensions! We have gathered the top stories about pensions and retirement security from the previous week.
NPPC News
This week, we published two blog posts addressing important issues:
Iowa Briefly Looks at Closing Pension System
Iowa’s DOGE task force, created by Gov. Reynolds, briefly eyed replacing IPERS with 401(k)-style plans—sparking strong pushback from public workers. Read the full blog to learn more.
Worker Representation in Pension Governance: Why It Matters
Worker voices on pension boards matter—for accountability, transparency, and long-term investment success. Yet, in Ohio, lawmakers have reduced member representation on the STRS board—undermining the voice of over 500,000 educators. Read the full blog here.
State News
Public Pension Funding Continues Steady Climb
New data from Milliman’s Public Pension Funding Index shows that the aggregate funded status of the 100 largest U.S. public pension plans ticked up to 83.0% as of July 31, 2025. This marks the fourth consecutive month of positive returns, with July’s 0.5% market gain translating to an additional $5 billion in assets.
The overall funding deficit for these plans now stands at $1.122 trillion, a slight decrease from the previous month. Encouragingly, 38 plans are now more than 90% funded, while 11 plans remain below 60%. Milliman projects different scenarios for the coming year, depending on investment performance; However, the steady upward trajectory suggests cautious progress toward long-term stability.
The Trump-Vance Agenda Puts Low-Income Families of Color at Risk in the Next Recession
A new report from the Economic Policy Institute highlights how the last two recessions—the Great Recession of 2008 and the pandemic recession of 2020—devastated low-income families of color, pushing many into unemployment, poverty, and housing insecurity. While swift federal action during the pandemic helped families recover faster than after 2008, millions still struggle with economic vulnerability.
The report notes that families of color make up more than 6 in 10 of all economically vulnerable families with children, and they are more likely to be headed by women, immigrants, or include a disabled parent or child. Even with pandemic-era relief programs, over 85% of Black families and 83% of Hispanic families still struggle with housing insecurity today.
Instead of building on the lessons of the pandemic—where bold action lifted families out of poverty—the Trump-Vance administration has dismantled worker protections, slashed over $1 trillion in Medicaid and SNAP funding, and prioritized tax cuts for corporations and the wealthy. The report warns that this austerity agenda, coupled with rising recession risks, will leave vulnerable families even more exposed to hardship in the years ahead.
We at NPPC know that retirement security doesn’t exist in a vacuum—it’s part of the broader fight for economic justice. When wages stagnate, housing insecurity rises, and public programs are dismantled, working families lose the stability they need to prepare for retirement. That’s why protecting pensions and the social safety net go hand-in-hand.
Gen Z Shows Optimism About Retirement—But Many Lack Pensions
A new survey from M&G finds that nearly 4 in 10 members of Generation Z (ages 18–24) say they are confident about their financial future—more than double the share of those in their 50s. Some even expect to retire in their 50s, despite the fact that the official pension age for their generation will be at least 68.
Yet this optimism masks a concerning reality: almost half of Gen Z workers don’t have a workplace pension, and just 8% list saving for retirement as a financial priority. Instead, many young adults are focused on short-term goals, such as travel or everyday expenses. Over 60% of people who haven’t started retirement planning say they don’t plan to begin until at least age 40—leaving them little time to build adequate savings.
Experts warn that Gen Z may be “sleepwalking into a too-little-too-late scenario” if confidence isn’t matched with action. Today’s auto-enrollment contributions, if left unchanged, could leave savers with just half of what they need for a secure retirement. Compounding the challenge, many young people look to friends and family for advice—often from older generations who benefitted from guaranteed pensions that Gen Z workers may never have access to.
There’s a clear takeaway: optimism alone won’t secure retirement. Defined benefit pensions remain the best way to guarantee workers’ retirement security—and without them, younger generations face an uphill battle. If policymakers genuinely want to support Gen Z, they should expand—not restrict—access to pensions and strengthen the retirement system so that future workers don’t face the impossible choice between enjoying life now and security later.
Oklahoma Think Tank Pushes to Protect Pension “Reforms”
This week, the Oklahoma Council of Public Affairs (OCPA), a Koch-funded think tank, published an article celebrating the state’s 2011 shift away from defined benefit pensions for public employees—a move that went against the best interests of dedicated public workers. The piece claims that closing off the traditional pension system and forcing new hires into a 401(k)-style “Pathfinder” plan has made Oklahoma a “national model.”
The article cites improved funded ratios for the Teachers’ Retirement System of Oklahoma and the Oklahoma Public Employees’ Retirement System as evidence of success. But the story is incomplete. While restricting benefits may improve the numbers on paper, it comes at the expense of workers’ retirement security. Pathfinder participants—teachers, corrections officers, social workers, and others—will never have the guaranteed, lifetime income that a defined benefit pension provides. Instead, their retirement is tied to the ups and downs of the stock market and their ability to contribute to individual accounts during already underpaid careers.
Notably, OCPA warns against proposals to restore or strengthen defined benefit pensions, painting them as fiscally reckless. Yet states like Wisconsin, South Dakota, and New York continue to maintain strong, responsibly funded pension systems that deliver predictable retirement income for millions of public employees. The real issue isn’t whether pensions can work—they do—it’s whether lawmakers choose to fund them responsibly.
We know that defined benefit pensions remain the most secure and cost-effective way to provide retirement benefits for public employees. Oklahoma’s so-called “reforms” may have improved actuarial numbers, but they weakened retirement security for the very workers who keep the state running. We’ll continue to push back against efforts to dismantle pensions and support policies that protect retirement for teachers, firefighters, and public employees nationwide.
Be sure to check back next Friday for the latest in the fight for a secure retirement! For now, sign up for NPPC News Clips to receive daily pension news from across the country directly to your inbox.