Florida may be nicknamed the Sunshine State, but for thousands of retired Connecticut state employees, it\u2019s the \u201cpension state\u201d.\u00a0\u00a0<\/p>\n
According to state records<\/a>, Connecticut\u2019s retirement system paid out $2.7 billion in pension checks in 2024, and nearly one in every four dollars \u2014 $677 million \u2014 went to retirees living outside Connecticut. Put another way, many of the people drawing from the system are the same ones escaping it \u2014 leaving state taxpayers to pick up the bill.<\/p>\n While most pension checks still land in Connecticut mailboxes, a large share of the state\u2019s retirement spending now supports economies elsewhere. Florida leads the list, receiving about a quarter-billion dollars, followed by Massachusetts, South Carolina, North Carolina, and New York. Other top destinations include Georgia, Maine, New Hampshire, Virginia, and Rhode Island.\u00a0<\/p>\n In total, roughly 25 percent of Connecticut\u2019s pension spending leaves the state each year \u2014 supporting restaurants, housing markets, and tax revenues far from home.\u00a0<\/p>\n The Legacy Burden\u00a0<\/p>\n Connecticut\u2019s earliest pension tiers, created before the 1990s, still drive much of the cost. Tier I plans feature the most favorable formulas and earliest retirement ages, producing higher average payouts than later tiers. Even with more moderate formulas for newer employees, total costs continue to rise.\u00a0<\/p>\n Today the state spends about one-quarter of its entire state budget \u2014 roughly $6 billion<\/a> a year \u2014 on retired state employees, the highest share in the nation. Reforms have slowed the bleeding, but the system still grows faster than taxpayers can fund it.\u00a0<\/p>\n A Pension System That Exports Wealth\u00a0<\/p>\n When pension payments flow out of state, Connecticut loses more than residents \u2014 it loses local economic activity that keeps Main Streets alive. Each check drawn from Connecticut\u2019s treasury and cashed elsewhere represents dollars not circulating through local businesses, property markets, and tax receipts. As more retirees relocate, fewer pension dollars remain to support the communities that fund the system.\u00a0<\/p>\n Coincidentally, pension recipients fleeing Connecticut\u2019s high cost of living are fleeing the very system that created it. According to The Pew Charitable Trusts, the state\u2019s unfunded pension obligations totaled $40.6 billion in 2022, equal to 148 percent of annual revenue, ranking fourth-highest in the nation. By mid-2025, the Lamont administration estimated that unfunded pension liabilities had declined<\/a> to $35.1 billion, thanks to nearly $8.6 billion in supplemental deposits made possible by the state\u2019s fiscal guardrails.\u00a0<\/p>\n Despite that progress, Connecticut still faces one of the largest<\/a> pension burdens in America, with more than $61.8 billion in combined unfunded obligations for pensions and retiree health care \u2014 leaving each taxpayer effectively $44,500 in the red, according to Truth in Accounting.\u00a0<\/p>\n The Cost of Growing Old in Connecticut\u00a0<\/p>\n