The state pension crisis registers with most people as distant thunder at most. But just as a hurricane hundreds of miles away begins to roil the ocean water, so too is New Jersey’s pension mess already stirring up problems for beneficiaries and the general public as well. The damage will get much worse as the storm gets closer.
The risk for beneficiaries is direct. There are a wide range of potential outcomes, depending on the uncertainties surrounding investment returns and on whether the state can meet an aggressive schedule of increased contributions.
Certain actuaries say that the state must more than double its contributions to about $6.6 billion annually within the next few years in order to stabilize the system. Other experts believe that the teachers and public employee pension funds may disappear entirely in little more than a decade.
What would happen then?
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