What is the Annualized Return vs. Plan Benchmark?

This chart compares the Plan’s historical, annualized asset-weighted return of all asset-class holdings over a time period to the asset weighted returns of the Plans asset class benchmarks.   

The annualized return of the plan’s asset weighted investment returns over time (generally 7 yr or 5 yr periods) is calculated as the geometric average of the amount of money earned by the plan’s investment options held each year over the given time period.  

It is calculated as a geometric average to show what a plan would earn over time in the annual return was compounded.  

The annualized return of the plan’s asset weighted benchmark returns over time (generally 7 yr or 5 yr periods) is calculated as the geometric average of the amount of money that would have been earned by the plan’s asset class benchmarks each year over the given time period.

The annualized return of the plan’s asset weighted benchmark returns over time (generally 7 yr or 5 yr periods) is calculated as the geometric average of the amount of money that would have been earned by the plan’s asset class benchmarks each year over the given time period.