Global Pension Assets Study – 2024

Global pension assets now stand at US$55.7 trillion after growth rebound in 2023

About the Study

The Global Pension Assets Study estimates global pension fund assets across 22 major pension markets (the P22). These geographies now stand at US$55.7 trillion in pension assets and account for 69% of the GDP of these economies. The study, conducted by WTW and the Thinking Ahead Institute since the 1990s, includes an analysis of the seven largest markets (the P7): Australia, Canada, Japan, Netherlands, Switzerland, UK and the US, which comprise 91% of total pension assets.

Pensions markets are still very concentrated with the 7 largest markets accounting for most of the pension assets in the world.
Source: Thinking Ahead Institute

Pension assets are growing once again – just as the importance of the pensions industry itself consistently increases in a world facing new challenges and opportunities for future prosperity. Growth is back on the agenda.

This global growth is not yet rapid, and pension assets remain behind their pre-2022 position, but it is far better than the experience a year before. Inflation has moderated, and as a result financial markets have remained supported by interest rates which appear also to have peaked, at least for now, in most countries.

Jessica Gao

Key spotlight subjects

Asset owners are likely to face multiple challenges in the coming years. The study draws attention to 4 subjects significant to the investment industry and its building resilience.

Macro uncertainty and systemic risk

Uncertainty is persisting in the global economy, heightened by geopolitical tensions and slow economic growth. Demand and supply conditions in the major advanced economies remain out of balance. Interest rates have peaked in most countries and may decline in 2024; inflation has come down from its highs but remains uncertain.

Increasing influence of governments on pension system​

Government influence on pension schemes is at high level as governments are looking to pension funds to play a role in funding both the greening and the new growth in domestic economies. Measures generally aim at removing regulatory frictions and encouraging a greater culture of longer-term risk-taking. For example, the “Mansion House” reforms in the UK are aiming to attract more cash into domestic investment and divert pension savings into higher risk, higher growth UK companies.

AI and technology

The operating model of asset owners is increasingly a partnership of HI and AI – human intelligence and artificial intelligence to craft and deliver innovative financial solutions, produce more accurate and timely reporting and foster organisational agility.

Future of pension design​

The long-standing transition from defined benefit (DB) to defined contribution (DC) pension schemes has been a notable trend in recent decades, driven by factors such as increased life expectancy, changing demographics, and the desire for cost predictability among employers. 

However, there is a growing sentiment that this shift may be going too far, with concerns about the adequacy of retirement income and the loss of financial security among retirees. The trajectory  favouring the DC design is no longer the force it was exemplified by developments in various countries. 

Read the full report for more detail on asset size, concentration and weighting as well as asset allocation, DB/DC split and more.