State pension plans, long beleaguered and adrift in a sea of red, may have turned a corner. A report by LifeHealthPRO says that data from Bloomberg show an increase in the states’ ability to meet their pension requirements. A slight increase, but an increase nonetheless.
Bloomberg found that the median state system in 2013 had 69.3% of the assets it needs to meet pension obligations; in 2012, it had 68.7% of the requisite funds.
Bloomberg attributes the rise in state pension plans’ fortunes to strengthening in the stock market. In addition, Eileen Norcross, a senior research fellow at George Mason’s University’s Mercatus Center, told LifeHealthPRO that state budget discipline played a part in the growing solvency as well.
Of course, medians are at least in part derived from extremes, and that is no less true in the case of this latest assessment of state pension health. Winners: Montana, whose funded ratio jumped roughly 10 percentage points in one year to 73.3%, and New Mexico, which had ranked 38th among the states in 2012 but in 2013 is in the middle of the pack. Losers: Massachusetts, whose ranking fell 11 places, and New Jersey, for which the news just never seems to get better, which had a ranking seven places lower among the states than it did in 2012.
Bloomberg found that the median state system in 2013 had 69.3% of the assets it needs to meet pension obligations; in 2012, it had 68.7% of the requisite funds.
Bloomberg attributes the rise in state pension plans’ fortunes to strengthening in the stock market. In addition, Eileen Norcross, a senior research fellow at George Mason’s University’s Mercatus Center, told LifeHealthPRO that state budget discipline played a part in the growing solvency as well.
Of course, medians are at least in part derived from extremes, and that is no less true in the case of this latest assessment of state pension health. Winners: Montana, whose funded ratio jumped roughly 10 percentage points in one year to 73.3%, and New Mexico, which had ranked 38th among the states in 2012 but in 2013 is in the middle of the pack. Losers: Massachusetts, whose ranking fell 11 places, and New Jersey, for which the news just never seems to get better, which had a ranking seven places lower among the states than it did in 2012.
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