Welcome to the latest edition of This Week in Pensions! We have gathered the best stories about pensions and retirement security from the previous week. This is the news you need to know in the fight for a secure retirement.
NPPC Highlights
NPPC State Legislative Update
This week, NPPC shared a state legislation update, highlighting key pension developments from across the country, including Alaska, Arizona, Colorado, Connecticut, Kansas, Minnesota, New York, Oklahoma, and more.
Across the states, one thing is clear: the fight for retirement security is moving forward. From efforts to restore defined benefit pensions to campaigns defending workers’ earned benefits, public employees and advocates continue to push back against policies that threaten hard-earned retirement security.
Read our latest legislative update to see where pension advocacy made progress this session and where the work continues.
State News
Wall Street Pushes to Expand Individual Retirement Savings into Private Equity and Crypto
Wall Street is continuing its push to allow private equity, private credit, hedge funds, crypto, and other alternative assets access to defined contribution retirement accounts. The Department of Labor’s (DOL) proposed rule drew tens of thousands of public comments this week.
Reuters reported that the proposal could redirect a portion of the $14.2 trillion in 401(k)-style retirement savings toward these alternative products. The Alliance for Prosperity and a Secure Retirement terms the issue “retirement fairness,” and asserts the goal of the move is to avoid placing “unnecessary” restrictions on “retirement savers from opportunities long available to large institutional investors.”
Labor unions also weighed in, submitting comment letters to the DOL. The AFL-CIO said, in a letter also signed by the American Federation of Teachers and Service Employees International Union, “allowing 401(k) plan investors to invest in these types of alternative investments is not ‘democratizing access to alternative investments,’ it is exposing working people’s retirement savings to illiquid, risky, and high fee investment schemes.”
The American Federation of State, County and Municipal Employees (AFSCME) also submitted a comment letter encouraging the agency to “withdraw the proposed rule and instead issue a new proposed rule or other guidance that is consistent with the longstanding fiduciary duty requirements placed on fiduciaries by the Employee Retirement Security Act of 1974.
Public Pension Funding Rebounds After Market Volatility
A new Milliman analysis found that public pension funding rebounded to 87.6% after April gains erased March losses. The update is a useful reminder that public pensions are long-term institutions designed to weather short-term market volatility.
As outlined recently in the NPPC Defined Benefit blog, month-to-month market swings can move funded-ratio headlines, but they do not change the underlying case for pensions. Defined benefit plans are built around long investment horizons, pooled risk, and steady contributions over time. Funding discipline protects benefits, smooths out temporary volatility, and eliminates an excuse to cut retirement security for public workers.
Despite market swings, public pension funding achieving an overall 87.6% funding average in the largest 100 plans is a good sign. Public plans are vulnerable to closure when funding trends downward. Solidly funded pension plans mean the retirement security of public employees will be secure for years to come.
Massachusetts Teachers Push to Correct a Longstanding Retirement Inequity
In Massachusetts, lawmakers are considering a fix for a longstanding retirement inequity affecting public school teachers. The Massachusetts Senate is weighing whether to provide teachers another chance at a retirement program to correct what advocates describe as a decades-old unfairness in teacher retirement benefits.
Retirement rules determine whether a career in public service leads to dignity and stability or uncertainty and regret. When teachers dedicate their careers to students and communities, they deserve retirement policies that fairly recognize that service. Massachusetts provides another example of workers organizing and pushing lawmakers to improve pension plans and strengthen the public workforce.
Be sure to check back next Friday for the latest news 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.