The gap between poorly funded pension plans and strongly funded ones is greater than in the past, says a new study.
For the past nine years, revenue growth and strong investment returns have helped state pension plans. However, the gap between poorly funded plans and strongly funded ones “has never been greater,” according to the Pew Charitable Trusts, coming in at more than $1 trillion for all 50 states.
While the Great Recession brought investment losses to plans in all 50 states, Pew's research indicates that “the eight states with the best-funded retirement systems rebounded and were, on average, 95 percent funded by 2017.”
The same was definitely not true for the 20 states with the lowest-funded pension plans, which instead “saw the financial position of their systems decline steadily from 76 percent funded in 2007 to 56 percent in 2017.”
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Marlene Satter
Marlene Y. Satter has worked in and written about the financial industry for decades.
