Retirement insights from a Colorado PERA perspective

A distant view shows a mountainous landscape with sloping peaks, green trees in the foreground, and a cloudy sky above.

A recent assessment finds the funding levels of public pension plans across the United States have generally improved in recent years despite market volatility and other challenges.



It’s a positive sign that while access to defined benefit pensions in the private sector has dwindled, many states remain committed to providing their public employees with a secure retirement.



<h2 style="color:#000000;" class="wp-block-heading has-black-color has-text-color has-medium-font-size">Assessing the financial health of public pensions</h2>



Pew Research Center, a nonpartisan research firm, keeps track of the financial health of public pensions in all 50 states. Its latest report focuses on plans’ funded ratios, which provide a comparison between a plan’s assets and its future obligations to members. For example, if a plan is 70% funded, that means the plan currently has 70% of the money it would need to pay out all benefits its retirees and working members have earned to date.



In 2023, the most recent year for which Pew has data for each plan, the overall funded ratio for public pensions was 74%. Thirty-five out of 50 states reported funding ratios in 2023 that were higher than in 2022, according to Pew.



A key factor Pew examined is net amortization, a measure of whether a plan receives enough funding and income from investments to reduce its unfunded liabilities—the portion of benefit obligations for which the plan does not have money on hand—while also paying benefits. A positive net amortization trend means the fund is bringing in enough money to pay down debt. Pew found most plans, including Colorado PERA, showed positive amortization from 2019 to 2023.



<h2 style="color:#000000;" class="wp-block-heading has-black-color has-text-color has-medium-font-size">PERA’s funded status</h2>



Thanks to the reforms included in Senate Bill 200 in 2018, PERA is on a path to full funding by 2048. As of December 31, 2024, the combined funded ratio for the five Division Trust Funds (State, School, Local Government, Judicial, and DPS) was 69.2%. In 2018, that number was only 59.8%. Senate Bill 200’s <a href="http://copera.org/automatic-adjustment-provision" target="_blank" rel="noreferrer noopener">Automatic Adjustment Provision</a> (AAP), which adjusts member and employer contributions, retiree annual increases, and the State’s direct distribution to PERA based on our funding progress, has been an important part of that improvement. The AAP is assessed every year so adjustments can be made as needed without requiring legislative intervention.



As of the end of 2024, PERA remains on track and adjustments via the AAP will not be necessary in 2026.



With budget discussions now underway at the State Capitol, PERA CEO/Executive Director Andrew Roth and Board Chair Hon. Rebecca R. Freyre recently wrote a guest opinion explaining the importance of consistent contributions in keeping PERA on track to reach its funding goal.



&#8220;While PERA is on a path to full funding by 2048, it’s important that we stay on that path and follow the plan laid out in SB18-200,” they wrote. “While we’re making progress, we need the General Assembly’s support to keep that momentum going. We all owe it to our members and retirees to stay the course.&#8221; 



Read more on the <a href="https://www.coloradopolitics.com/2025/11/07/protect-coloradans-retirement-security-opinion/" target="_blank" rel="noreferrer noopener">Colorado Politics website</a>.

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