Pension and Retiree Health Care Funding

Many states continue to face shortfalls between assets and liabilities

Pension and Retiree Health Care Funding

Many state-run retirement systems face significant shortfalls between the pension benefits that governments promised to their workers and the funding available to meet those obligations.

Some pension plans for state and local workers are well-funded, but unless changes are made in a number of other states, retirees, workers, and taxpayers will have to contend with rising costs and potentially unpaid promises for years to come.

Wollongong, New South Wales
Wollongong, New South Wales
Issue Brief

Stable Public Pension Funding Within Reach

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Issue Brief

Since The Pew Charitable Trusts first evaluated the fiscal health of states’ public sector pension systems in 2007, these retirement plans have varied widely, both across states and year over year, in their ability to cover the costs of promised benefits with the assets they had on hand. But in 2020, pension systems, collectively, met a crucial benchmark for minimum plan funding for the first time since 2001. As a result, states are now positioned to sustainably fund their pension promises for the long run—if they make smart policy choices to seize this opportunity.

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