Pension accounting: ASC 715 discount rate selection

Home
What we do

Technology and investment solutions that connect the financial services industry. We deliver capabilities standalone or as comprehensive solutions.

Technology
Powering the future of wealth with enterprise platform solutions that address complex business challenges.

Operations
Achieving operational excellence with business process outsourcing and data management that help clients improve efficiency and performance.

Asset management
Connecting investors to what matters most, so they can achieve their goals and make confident decisions.

Featured
Who we serve

RIAs and financial advisors

Wealth and asset managers

Banks and broker-dealer advisors

Institutional investors

Families and individuals

Featured
Insights

Insights
Perspectives and happenings from our leaders and experts

Newsroom
The latest news and announcements

Featured
About us

Our story
Who we are, what we do, and how we do it.

Our commitment
Building brave futures through the power of connection.

Investor relations

Our leadership team

Newsroom

Locations

Careers

Featured

January 8, 2025

1 MIN READ

Disclosures for 2024

Now that 2024 has closed and indices can be updated through year-end, there are changes in long bond yields from December 31, 2023 to December 31, 2024. The figure below shows those changes.

Change in yields, year-end 2023 to year-end 2024
Bond index	Dec. 2023 yield	Dec. 2024 yield	Change (BPS)
Bloomberg AA Long Credit	4.82	5.54	72
FTSE Pension Liability Index¹	4.83	5.54	71
FTSE Pension Liability Index, Intermediate²	4.80	5.49	69

What does this mean?

Yields are higher at all durations over two years with increases of up to 84 bps. Based on our analysis, plans with a December 31 measurement date should expect increases in their effective PBO discount rate, typically by approximately 60 to 70 bps for most plans, except in extreme circumstances where a liability is overwhelmingly weighted to payments in the first few years of the payout projection.

Our Chief Actuary is here to help

First Name *

Last Name *

Email Address *

Country *

Your country of residence *

Collected to follow global data privacy requirements only

Comments

I understand SEI may send future emails to me, even if I opted-out before, and that I can opt-out again later.

address2

Information provided by SEI Investments Management Corporation (SIMC), a registered investment adviser and wholly owned subsidiary of SEI Investments Company.

[1] Financial Times Stock Exchange (FTSE) Pension Liability Index has a duration as of 12/31/2024 of 16.8 years and the index represents a fully-open plan.

[1] Financial Times Stock Exchange (FTSE) Pension Liability Index Intermediate has a duration as of 12/31/2024 of of 13.2 years and the index represents a plan that is closed to new entrants.