Calpers, the largest state pension in the U.S., saw its funding level rise 7 percentage points last year.
The $300 billion-plus pension fund racked up an 18.4 percent gain on its investments in 2014, giving it a funding level of 77 percent at year-end. That's up from 70 percent in 2013.
Pensions across the U.S. are short more than an estimated $915 billion needed to cover benefits promised to government workers, according to the Pew Charitable Trust. Taxpayers have been asked to make up the shortfall. A report issued by the California Public Employees' Retirement System said that the return far outpaced the goal of 7.5 percent that had been set by its board. In addition, it's close to double the average annual rate of return for the last three years — which was still double-digit, at 10.4 percent.
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The boost in returns came thanks to a combination of income-producing real estate — bringing in returns of 13.4 percent — and a booming stock market, in which domestic and international stocks soared by 24.8 percent.
"For perspective, the fund has grown by nearly 83 percent since its low of $164 billion at the bottom of the global financial crisis in 2009," Anne Stausboll, Calpers' chief executive, said in the report. She also pointed out that 2014 was the fund's "fourth double-digit return" in the past five years.
Bloomberg News contributed to this report.
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