Stability in overall pension plan funding masks a growing divide

Aubry, Jean-Pierre, Caroline V. Crawford, and Kevin Wandrei. “Stability in overall pension plan funding masks a growing divide”. State and Local Pension Plans 62, Chestnut Hill, Mass.: Center for Retirement Research at Boston College, October 2018. http://hdl.handle.net/2345/bc-ir:108196.
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Abstract

The brief's key findings are: (1) Under traditional accounting rules, the aggregate funded ratio for state and local pension plans in 2017 was 72 percent, largely unchanged from recent years. (2) This overall stability, however, masks a growing gap among plans: the average funded ratio was 90 percent for the top third but just 55 percent for the bottom third. (3) The plans in the bottom third are in worse shape because, on average, they receive lower long-term investment returns and pay less of their required contributions. (4) In addition, all plans face the possibility of a market downturn, which could set back funding for several years.

Title
Stability in overall pension plan funding masks a growing divide
Author
Aubry, Jean-Pierre
Crawford, Caroline V.
Wandrei, Kevin
Center
Center for Retirement Research
Genre
report
Date Issued
October 2018
Publisher
Center for Retirement Research at Boston College
Series Title
State and Local Pension Plans
Series Number
62
Persistent Link
http://hdl.handle.net/2345/bc-ir:108196
Use Restrictions
These materials are made available for use in research, teaching and private study, pursuant to U.S. Copyright Law. The user must assume full responsibility for any use of the materials, including but not limited to, infringement of copyright and publication rights of reproduced materials. Any materials used for academic research or otherwise should be fully credited with the source. The publisher or original authors may retain copyright to the materials.
Subject
State and Local Pensions

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