As 2025 ends, and we begin to focus on the year ahead, we have much to look forward to in 2026. The new year will bring important improvements to those of you who rely on CalPERS for health benefits, as well as the same commitment to delivering on pension benefits that we have held for more than nine decades.
Let’s start with that commitment to you and your family.
2.4 Million Strong
We proudly say that “CalPERS serves those who serve California.” Today, that means we are working on behalf of nearly 2.4 million public sector employees and their beneficiaries. We are talking about state employees, city and county workers, and those who help keep our schools running across California.
Since 1932, CalPERS has built retirement security for these public servants. Roughly one-third of our members, about 825,000 people, are retired or a beneficiary. Today the average retiree receives almost $3,800 per month, money that can provide stability and security.
As a pension fund, we are committed to securing your future by making sure CalPERS has the resources to continue paying those monthly benefits for the next century and beyond.
Stronger Funded Status
One key measure of our overall strength is our funded status — an estimate of the funds we have on hand to meet our current and future obligations. Thanks to the strong work of our team, CalPERS had an estimated funded status of 84% as of Dec. 31, 2025, up from 71% at the end of fiscal year 2021-22.
This is a significant improvement, and we remain committed to continue working toward full funding.
Best in the Nation
We head into 2026 equipped with a refined investment strategy. In addition to investing in a broad swath of publicly traded companies, our team is focused on seizing the best opportunities with private partners. The private equity class of investments earned a 14.3% return in the most recent fiscal year. And a November report by the respected publication Pensions & Investments found that CalPERS posted the highest private equity return among 74 U.S. public pension funds with more than $1 billion in assets.
In November, our Board of Administration voted to make CalPERS the first major public pension fund in the nation to adopt the Total Portfolio Approach, a method of investing used successfully by large funds worldwide that prioritizes the overall health of the fund for the long-term benefit of our members and employers. The new approach means our investment team members will work together even more closely to identify investments that will produce the best results.
New Pharmacy Benefits Manager
The new year will also bring a new pharmacy benefits manager for the 587,000 CalPERS members enrolled in our Basic and Medicare health maintenance organization (HMO) and preferred provider organization (PPO) plans. The new contract with CVS Caremark that begins on January 1 requires CVS to forfeit up to $250 million if it does not meet targets for improved health care and controlled costs.
We are also working closely with health plan providers such as Blue Shield and Included Health to hold the line on costs by tying the money we pay them every year to how well they manage costs.
Opportunities to Learn More
There will be many opportunities in the coming year for you to learn more about the specifics of your pension and health benefits. In 2026, as always, our expert team members will be fanning out across the state to meet you near where you live and work. I encourage you to attend one of our CalPERS Benefits Education Events. We also host numerous online seminars, individual online appointments, and in-person visits at our Regional Offices.
I hope this message finds you and your family safe and healthy. We are looking forward to serving you in the year ahead.
Best Wishes,
Marcie Frost