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10 Best and 10 Worst States for Pensions


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The pension has long been a standard part of retirement for many Americans, particularly for public sector employees like police officers and teachers. Offering a pension — a set annual income for long-time employees after they retire — used to help attract quality employees by offering them the promise of financial security in their golden years.

Does the same hold true today? Private companies rarely offer pensions anymore, and states are struggling with pension commitments they made decades ago. The relative security of a pension is tied to the well-being of the government that offers it, and a great many U.S. states currently have unfunded pension liabilities. GOBankingRates analyzed all 50 states in terms of unfunded pension liabilities for 2021 and 2022, as well as unfunded pension liabilities per capita for 2021 and 2022, sourced from American Legislative Exchange Council.

The results are in, with the top 10 states that are well-prepared to continue funding their pension systems, and the bottom 10 that might find themselves in fiscal hot water in the near future. Did your state make the list?

Best States for Pensions

10. Minnesota

  • 2021 Unfunded Liabilities: $148,316,886,233
  • 2022 Unfunded Liabilities: $112,677,522,555
  • 2021 Unfunded Liabilities per Capita: $25,991
  • 2022 Unfunded Liabilities per Capita: $19,742

9. Iowa

  • 2021 Unfunded Liabilities: $69,171,677,447
  • 2022 Unfunded Liabilities: $53,942,069,863
  • 2021 Unfunded Liabilities per Capita: $21,681
  • 2022 Unfunded Liabilities per Capita: $16,893

8. Indiana

  • 2021 Unfunded Liabilities: $69,135,444,681
  • 2022 Unfunded Liabilities: $54,732,139,147
  • 2021 Unfunded Liabilities per Capita: $10,189
  • 2022 Unfunded Liabilities per Capita: $8,042

7. Florida

  • 2021 Unfunded Liabilities: $302,873,520,482
  • 2022 Unfunded Liabilities: $234,011,651,429
  • 2021 Unfunded Liabilities per Capita: $14,062
  • 2022 Unfunded Liabilities per Capita: $11,236

6. North Carolina

  • 2021 Unfunded Liabilities: $174,143,444,573
  • 2022 Unfunded Liabilities: $132,283,080,396
  • 2021 Unfunded Liabilities per Capita: $16,681
  • 2022 Unfunded Liabilities per Capita: $12,537

5. Utah

  • 2021 Unfunded Liabilities: $55,458,770,068
  • 2022 Unfunded Liabilities: $44,620,043,795
  • 2021 Unfunded Liabilities per Capita: $16,951
  • 2022 Unfunded Liabilities per Capita: $13,367

4. Oklahoma

  • 2021 Unfunded Liabilities: $80,636,914,666
  • 2022 Unfunded Liabilities: $61,068,329,112
  • 2021 Unfunded Liabilities per Capita: $20,366
  • 2022 Unfunded Liabilities per Capita: $15,318

3. New York

  • 2021 Unfunded Liabilities: $508,708,887,680
  • 2022 Unfunded Liabilities: $368,166,261,391
  • 2021 Unfunded Liabilities per Capita: $25,182
  • 2022 Unfunded Liabilities per Capita: $18,561

2. Washington

  • 2021 Unfunded Liabilities: $1657,432,460,443
  • 2022 Unfunded Liabilities: $125,178,721,352
  • 2021 Unfunded Liabilities per Capita: $21,730
  • 2022 Unfunded Liabilities per Capita: $16,103

1. Idaho

  • 2021 Unfunded Liabilities: $29,276,256,967
  • 2022 Unfunded Liabilities: $20,664,561,618
  • 2021 Unfunded Liabilities per Capita: $15,919
  • 2022 Unfunded Liabilities per Capita: $11,236

Worst States for Pensions

10. Connecticut

  • 2021 Unfunded Liabilities: $145,779,590,837
  • 2022 Unfunded Liabilities: $125,178,721,352
  • 2021 Unfunded Liabilities per Capita: $40,428
  • 2022 Unfunded Liabilities per Capita: $34,718

9. New Mexico

  • 2021 Unfunded Liabilities: $76,211,334,592
  • 2022 Unfunded Liabilities: $67,502,035,646
  • 2021 Unfunded Liabilities per Capita: $35,991
  • 2022 Unfunded Liabilities per Capita: $31,903

8. New Jersey

  • 2021 Unfunded Liabilities: $370,157,297,823
  • 2022 Unfunded Liabilities: $321,059,516,097
  • 2021 Unfunded Liabilities per Capita: $39,849
  • 2022 Unfunded Liabilities per Capita: $34,645

7. Massachusetts

  • 2021 Unfunded Liabilities: $191,086,201,505
  • 2022 Unfunded Liabilities: $175,167,312,917
  • 2021 Unfunded Liabilities per Capita: $27,182
  • 2022 Unfunded Liabilities per Capita: $25,079

6. Illinois

  • 2021 Unfunded Liabilities: $533,727,891,857
  • 2022 Unfunded Liabilities: $467,902,338,216
  • 2021 Unfunded Liabilities per Capita: $41,657
  • 2022 Unfunded Liabilities per Capita: $36,926

5. Alabama

  • 2021 Unfunded Liabilities: $92,734,851,779
  • 2022 Unfunded Liabilities: $93,824,726,335
  • 2021 Unfunded Liabilities per Capita: $18,457
  • 2022 Unfunded Liabilities per Capita: $18,616

4. Hawaii

  • 2021 Unfunded Liabilities: $58,122,692,070
  • 2022 Unfunded Liabilities: $53,129,262,556
  • 2021 Unfunded Liabilities per Capita: $39,939
  • 2022 Unfunded Liabilities per Capita: $36,508

3. California

  • 2021 Unfunded Liabilities: $1,530,649,405,907
  • 2022 Unfunded Liabilities: $1,405,052,021,581
  • 2021 Unfunded Liabilities per Capita: $38,713
  • 2022 Unfunded Liabilities per Capita: $35,787

2. Alaska

  • 2021 Unfunded Liabilities: $31,331,382,418
  • 2022 Unfunded Liabilities: $33,761,865,724
  • 2021 Unfunded Liabilities per Capita: $42,829
  • 2022 Unfunded Liabilities per Capita: $46,080

1. Nevada

  • 2021 Unfunded Liabilities: $82,252,281,510
  • 2022 Unfunded Liabilities: $99,000,289,435
  • 2021 Unfunded Liabilities per Capita: $26,494
  • 2022 Unfunded Liabilities per Capita: $31,489

Joel Anderson contributed to the reporting for this article.

Methodology: GOBankingRates analyzed all 50 states in terms of three overarching factors: (1) Unfunded pension liabilities for 2021 and 2022, (2) unfunded pension liabilities per capita for 2021 and 2022, and (3) funding ratio of public pension plans for 2021 and 2022, sourced from American Legislative Exchange Council. States were scored using these three factors and scored for their respective for year-over-year change for each metric. Scores were combined, with unfunded pension liabilities receiving half weight, since larger states naturally have larger liabilities, while all other factors received full weighting. All data was collected and up to date as of Sept. 25, 2023.

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