Who Pays for CalPERS Pensions?

How Public Employee Pensions Are Funded

Some people believe that taxpayers fund the total cost of public pensions. This isn’t true.

The largest contribution comes from CalPERS' investments, with additional funding from employer and employee contributions. Some workers currently contribute up to 17% of their paychecks to help fund their own pensions.

The CalPERS Pension Buck illustrates the sources of income that fund public employee pensions.

Based on a 20-year average ending June 30, 2026, for every dollar CalPERS pays in pensions:

  • 58 cents from investment earnings
  • 32 cents from employer contributions
  • 10 cents from employee contributions

In other words, 68 cents out of every public employee pension dollar is funded by CalPERS' own investment earnings and member contributions. In the fiscal year ended June 2026, CalPERS paid out more than $ 36.5 billion in pension benefits.

Pension Buck Infographic highlighting breakdown of sources of pension funding

Pension Payments Contribute to Local Economies

CalPERS retirees and beneficiaries contribute billions of dollars to California’s economy every year. Their pension spending supports local businesses, sustains jobs, and generates tax revenue in every region of the state. In 2024, their monthly pension payment generated $34.6 billion in economic activity, which:

  • Supported nearly 158,000 jobs
  • Generated $1.6 billion in tax revenue for local industries
  • Supported local community growth

Source: CalPERS Retiree Pensions: Powering California Communities Economic Impact Trends (PDF)

Facts at a Glance