State & Local Pensions
State and local government workers have traditionally had defined benefit (DB) pensions that insulate them from the stock market and ensure that they do not outlive their savings. Funding these plans, however, has become burdensome for many governments, with costs rising dramatically in the immediate wake of the 2008 financial crisis and continuing to grow…
In mature plans, the excess of benefits over contributions makes it hard for assets to grow. We have recently released an update on the funded status of state and local pension plans. The analysis shows that the ratio of assets to promised benefits in FY 2025 is 77.7 percent, 1.5 percentage points higher than 2023…
