Asset Liability Management (ALM)
The Asset Liability Management (ALM) process is an integrated review of our assets and liabilities to inform decisions designed to achieve a sound and sustainable fund.
The goal of the ALM process is to balance the expected cost of future pension payments with the expected future investment returns. During the process, the CalPERS board reviews its overall risks, taking into consideration the long-term sustainability of the system.
This formal process runs on a four-year cycle and includes a review of CalPERS’ investment portfolios and retirement plan liabilities. Capital Market Assumptions are primarily based on expectations of future investment returns. Liability projections are based on demographic and economic factors and trends, including membership dynamics, future salary and payroll growth, retirement ages, inflation, and life expectancy.
This innovative and transparent approach is overseen by the board and used to make sound decisions that applies to the Public Employees’ Retirement Fund (PERF) and our other affiliate funds.
- 2021 Asset Liability Management (ALM) Decision Frequently Asked Questions
- Asset Liability Management Process and Timeline (PDF)
- CalPERS Asset Liability Management Cycle (PDF)
- CalPERS CEO on the ALM Challenge
- Capital Market Assumptions Methodology Board Education Session (PDF)
- Frequently Asked Questions About Asset Liability Management (ALM)
- Funding Risk Mitigation Policy FAQ (PDF)
- CalPERS Funding Risk Mitigation Policy History, Current Status, Outlook (PDF) July 15, 2021
- CalPERS Affiliate Fund Asset Liability Management Webinar – March 9, 2022