Wednesday, December 19, 2007

Report: Many U.S. state pension funds not fully funded

More U.S. state pension funds are funded below 80 percent than five years ago, according to data released on Tuesday.

"Despite a strong economy and solid growth in tax revenues since 2002, many states have failed to achieve a higher funded status of their pension plans," analysts at Loop Capital Markets wrote in a report.

According to the most recent numbers based on data from 2005 or 2006, 32 state pension plans out of the 74 Loop monitors were funded below 80 percent. In 2002, only 16 of the 74 plans had funding below 80 percent, Loop said.

Many state pension funds say they need to have at least an 8 percent average annual investment return to keep up with their obligations.

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