Weighted-average assumptions used to determine net peri- odic benefit costs are as follows: Weighted-average assumptions used to determine benefit  obligations are as follows: The expected long-term rate of return on plan assets is based on fair value and is developed in consultation with outside advi- sors. A range is determined based on the composition of the asset portfolio, historical long-term rates of return, and estimates of  future performance. For measurement purposes, an 8.0% annual rate of increase in the per capita cost of covered health care benefits for pre-Medi- care and post-Medicare retirees’ coverage is assumed for 2015. The pre-Medicare and post-Medicare rate is assumed to  decrease to 5.0% for 2020, and remain at that level thereafter. The assumed discount rate, expected long-term rate of return on plan assets, rate of future compensation increase, and health care  cost trend rate have a significant impact on the amounts reported for the benefit plans. A one-percentage-point change in these  rates would have the following effects: The actual and target weighted-average asset allocations for the Company’s pension plan assets as of the plan measurement  date are as follows: 2014 2013 Asset Category  Actual  Target Range Actual  Target Range Large Capitalization Equity  33.0%  15-35% 29.2%  15-35% Hormel Foods Corporation Stock  – 0-10% 6.7%  0-10% Small Capitalization Equity  6.0%  5-15% 6.3%  5-15% International Equity  20.8%  15-25% 22.0%  15-25% Private Equity  5.0%  0-15% 4.2%  0-15% Total Equity Securities  64.8%  55-75% 68.4%  55-75% Fixed Income  34.0%  25-45% 30.0%  25-45% Cash and Cash Equivalents  1.2%  – 1.5%  – 1-Percentage-Point Expense  Benefit Obligation (in thousands)  Increase  Decrease  Increase  Decrease Pension Benefits: Discount rate  $(13,494)  $17,172  $(155,910)  $195,454 Expected long-term rate of return on plan assets   (11,531)   11,531  –  – Rate of future compensation increase  869  (841)  4,713  (4,586) Post-retirement Benefits: Discount rate  $ 1,209  $ 4,178  $ (33,151)  $ 40,195 Health care cost trend rate  1,935   (1,610)  35,953   (29,773) 2014 2013  2012 Discount rate  4.89% 4.05%  5.33% Rate of future compensation increase (for plans that base benefits on final compensation level)  3.91% 3.97%  3.93% Expected long-term return on plan assets  7.80% 7.90%  8.00% 2014 2013 Discount rate  4.31% 4.89% Rate of future compensation increase (for plans that base benefits on final compensation level)  3.94% 3.91% 49