Connecticut has roughly half of what it needs to pay future retirement benefits for its workers, with one lawmaker calling the situation a “ticking time bomb,” The Wall Street Journal reports.
Ironically, that means the Constitution State, which is home to hedge funds and some of the country’s wealthiest towns, is battling financial distress rivaling that of Kentucky or Illinois, the Journal reported.
Some investors concerned about the size of Connecticut’s pension hole are backing away from bonds issued by the state or demanding bigger rewards to hold them.
“Connecticut’s surprising pension predicament shows how even the wealthiest parts of the U.S. are struggling to keep pace with ballooning retirement obligations that now amount to $1 trillion nationally,” the Journal reported.
“Connecticut’s unfunded pension liabilities more than doubled over the past decade to $26 billion as the state’s retirement system reeled from inadequate state contributions, a subpar investment record and longer lifespans for its retirees,” the Journal reported.