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The markets giveth and the markets taketh away. Unfunded liabilities for state pension funds are expected to climb from $783 billion in 2021 to $1.3 trillion in 2022. The funded ratio of state pensions would fall from 85% last year to 75% in 2022.
That's according to the Reason Foundation, which states that after the market expansion of 2021 helped pensions; the rather lackluster performance of markets this year could see an average rate of return for state pensions at -6%. Should that be the case, Reason Foundation estimates that some of the nation's largest pension funds, California, New York, Texas, Ohio, Florida and Illinois, would see their unfunded pension liabilities jump by more than $20 billion compared to 2021.
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