Some public pensions funds could run dry in downturn
CHERRY HILL, N.J. (AP) - Many pension funds for public workers already owe far more in retirement benefits than they have in the bank, and the problem will only grow worse if the economy slows down, according to a report released Thursday.
The study from The Pew Charitable Trusts found that the New Jersey and Kentucky funds are in such perilous shape that they risk running dry.
"Even after eight years of economic recovery - eight straight years of stock market gains - the public pension plans are more vulnerable than they've ever been to the next recession," researcher Greg Mennis said in an interview.
Governments have been ramping up contributions to the funds to help cover the promises they've made to retirees, but that leaves less money to spend on schools, police, parks and other core government services.
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