Who Pays? The CalPERS Pension Buck Identifies the Income Sources of Public Employee Pensions
October 19, 2015
Note: An updated version of the Pension Buck is now available.
Some people believe that taxpayers fund the total cost of public pensions. This is untrue.
The largest contribution comes from CalPERS investment dollars, with additional funding from employee and employer contributions. Workers currently contribute up to 15.25 percent of their paycheck to help fund their own pensions.
The CalPERS Pension Buck illustrates the sources of income that fund public employee pensions. Based on data over the past 20 years ending June 30, 2015, for every dollar CalPERS pays in pensions, 65 cents comes from investment earnings, 22 cents from employer contributions, and 13 cents from employee contributions.
CalPERS pension payments generate nearly $31 billion of economic activity per year in California, supporting almost 105,000 jobs and generating more than $716 million in sales and property tax revenue every year.