NEW STUDY: Private Equity Delivers the Strongest Returns for Retirees Across America
Dunham: “Year after year, private equity has outperformed every major asset class over the long term, offering reliable and robust returns even during periods of economic volatility”
WASHINGTON, D.C. – Today, the American Investment Council released its 2025 public pension study, showing that private equity continues to deliver steady, reliable, and robust returns for public pension funds. In 2024, private equity investments delivered a median annualized return of 13.5 percent over a 10-year period. More than 90% of institutional investors are planning to either increase or maintain their current allocations to private equity over the long term. Every year since 2012, our study has found that private equity is the best-returning asset class in public pension portfolios, outperforming public equity, real estate, and fixed income.
“More than 30 million first responders, schoolteachers and dedicated public servants depend on private equity to secure their retirements because private equity has outperformed every major asset class over the long term, offering steady, reliable, and robust returns even during periods of economic volatility,” said AIC President and CEO Will Dunham. “Our latest study shows how responsible private investment directly benefits public servants in communities across America.”
Research from Cambridge Associates reinforces AIC’s findings, “institutions with higher private investment allocations experienced higher returns historically. And, those returns tended to be less volatile.”
The study analyzed 200 U.S public pension funds.
By The Numbers:
- 13.5% – The private equity median annualized return over a 10-year period, higher than all other asset classes including public equity, real estate, and fixed income.
- 34 Million – The number of U.S. public sector workers who depend on private equity to secure their retirements.
- 89% – The share of public pension funds nationwide that invest a portion of their portfolio in private equity.
- 94% – The share of institutional investors planning to either increase their allocation or maintain their current allocations to private equity over the long term.
Top Ten Public Pension Funds by Private Equity Returns:
- The Vermont Pension Investment Commission- 18.82%
- The Ohio School Employees Retirement System – 17.20%
- West Virginia’s Investment Management Board – 17.03%
- Massachusetts Pension Reserves Investment Trust – 16.88%
- Illinois State Board of Investment – 16.70%
- City of Baltimore Employees’ Retirement System – 16.50%
- Iowa Public Employees’ Retirement System – 15.99%
- Chicago Policeman’s Annuity & Benefits Fund – 15.94%
- New Mexico Public Employee’s Retirement System – 15.92%
- The Florida Retirement System – 15.81%
To learn more, read the full 2025 Public Pension Study.
