Many pension fund members are under the mistaken belief that their fund is outperforming the market, acccording to a new survey by Spectrem Group.
Most of the pension funds identified in the survey had returns below the benchmarks, according to the financial research firm.
Spectrem surveyed pension fund members in November, including thos from CalPERS, the pension fund for California's public workers, and NYC Funds, the pension fund for New York City workers.
Although CaIPERS and NYC Funds were underfunded, the majority of their members believed their pensions were fully funded, according to the survey.
Spectrem made respondents aware of their pension fund's status and respondents expressed high levels of concern about their ability to receive benefits in the future.
Respondents stated they were knowledgeable about their pension funds, but Spectrem found respondents' claims to be inconsistent. Most members could not determine the status of their fund, its investment direction or recent returns, according to the report.
Respondents were unaware of the number of alternative investments in their pension funds. After Spectrem provided them with the correct information, pension members responded that they wanted less alternative investments.
"What they really want is two things—one is for the state or municipality [that sponsors the retirement fund] to focus on investing with the best returns and ensuring that their pension funds are fully funded," said Spectrem's president George Walper.