Plan

Alabama ERS

State

Alabama

Funded Ratio

63.7%

Assets

$14.46B

Members

194,893

Health Grade: C — Underfunded — significant gap between assets and liabilities

FY2023 data Grade C Public Plans Database

Alabama ERS

Funded ratio, unfunded liability, member counts, ARC coverage, and 23-year financial history for Alabama ERS — sourced from the Public Plans Database (Boston College CRR) and cross-checked against actuarial valuations.

Browse all states → How we grade plans

By Kiznis Studio Editorial · June 2026 · Alabama · General State Plan · Data through FY2023

Financial Health Grade

Underfunded — significant gap between assets and liabilities

Funded Ratio

63.7%

actuarial assets / liabilities

Unfunded Liability

$8.24B

actuarial shortfall

Total Members

194,893

active + retired + vested

1-Year Return

21.2%

net investment return

11.4pp vs 5-yr avg

5-Year Avg Return

9.8%

annualized, net of fees

ARC Payment

13.9%

of actuarially required contribution

How Alabama ERS Funded Ratio Compares

Plan Funded Ratio 63.7%

National avg

A ratio of 63.7% compared against the national public-pension average of 73.5%.

Healthy Threshold

Plans above 80% are generally considered adequately funded by NASRA standards.

Participant Composition

The active-to-retiree ratio is a leading indicator of long-term plan sustainability — plans with more retirees than active contributors face mounting cash-flow pressure as benefit payments outpace incoming contributions.

Investment Policy Mix

Public pension plans report their asset allocation in Form 5500 Schedule H Part I disclosures. Equity-heavy mixes capture market upside but introduce volatility; fixed-income tilts protect funded status during downturns at the cost of long-run return.

Historical Funded Ratio

Year	Funded Ratio	Assets	Unfunded	Members
2024	63.7%	N/A	N/A	N/A
2023	63.4%	$14.46B	$8.34B	194,893
2022	65.6%	$13.30B	$6.96B	186,998
2021	67.7%	$15.84B	$7.55B	182,563
2020	68.2%	$13.47B	$6.28B	173,444
2019	68.2%	$12.88B	$6.01B	198,002
2018	68.7%	$13.04B	$5.95B	194,939
2017	67.8%	$12.43B	$5.91B	183,007
2016	66.3%	$11.46B	$5.84B	186,135
2015	67.3%	$10.82B	$5.24B	184,407
2014	66.9%	$11.16B	$5.51B	182,923
2013	65.7%	$10.35B	$5.40B	137,378
2012	65.7%	$9.42B	$4.92B	138,611
2011	65.8%	$8.34B	$4.34B	139,328
2010	68.2%	$8.40B	$3.92B	138,931
2009	72.2%	$7.89B	$3.04B	137,278
2008	75.7%	$8.87B	$2.85B	134,093
2007	79.0%	$10.67B	$2.84B	130,052
2006	81.1%	$9.25B	$2.16B	126,718
2005	84.0%	$8.70B	$1.66B	122,843

What the Data Says About Alabama ERS

Alabama ERS reports a funded ratio of 63.7% as of fiscal year 2023, earning a financial health grade of C in the Public Plans Database. The plan holds $14.46B in market assets against an unfunded liability of $8.24B. As a General State plan operating under Alabama sponsorship, it covers 194,893 members (85,069 active contributors, 57,202 retirees drawing benefits). These figures aggregate from Form 5500 filings submitted to the Department of Labor and actuarial valuations reported through NASRA.

A funded ratio in the 60–80% range indicates moderate underfunding that falls near the national average of 72–75% but leaves the plan exposed to market downturns and demographic shifts. Employer contributions covered 13.9% of the Annual Required Contribution in the most recent reporting cycle, while the plan posted a 5-year average investment return of 9.8%. The relationship between contribution adequacy and investment performance determines whether the unfunded liability narrows or expands year over year.

For Alabama taxpayers and plan members, the $8.24B unfunded gap represents the actuarial shortfall that must eventually be closed through a combination of contributions, investment returns, or benefit modifications. Unlike private-sector pensions governed by ERISA and backstopped by the PBGC, public plans like Alabama ERS rely on the full faith and credit of Alabama — meaning funding shortfalls flow through to state and local budgets rather than a federal insurance program. This information summarizes official Public Plans Database disclosures and is provided for research and educational purposes only. It is not financial, legal, or retirement-planning advice; active and retired members with specific benefit questions should consult their plan administrator directly.

Membership

85,069

Active Members

57,202

Retirees

194,893

Total Members

Plan Details

Plan Type: General State
State: Alabama
Market Assets: $14.46B
ARC Payment: 13.9%

Source: Public Plans Database (PPD)
Boston College CRR / NASRA

Other Alabama Plans

Birmingham Police and Fire 74.0%
Birmingham Retirement & Relief System 72.9%
Alabama Teachers 66.1%

All Alabama plans →

Related Resources

Pension Guides

Frequently Asked Questions

Is Alabama ERS fully funded?

Alabama ERS has a funded ratio of 63.7% as of FY2023, earning a health grade of C. A funded ratio of 100% means the plan has enough assets to cover all projected liabilities. Ratios above 80% are generally considered adequately funded; ratios below 60% indicate significant underfunding and risk to future benefits.

What happens if Alabama ERS runs out of money?

Public pension plans like Alabama ERS are backed by the sponsoring government entity — in this case Alabama. If a plan's assets are insufficient, the state or local government is typically required to make up the difference through increased contributions, benefit adjustments, or tax measures. Unlike private pensions, public pensions are not insured by the PBGC, but they do carry the full faith and credit of the sponsoring government.

What does a funded ratio of 63.7% mean?

A funded ratio of 63.7% means that Alabama ERS currently has assets equal to 63.7% of its projected benefit obligations. The unfunded liability — the gap between assets and liabilities — stands at $8.24B. This represents a moderate funding gap that requires ongoing monitoring.

How does Alabama ERS compare to other public pensions?

Alabama ERS is a General State plan in Alabama serving 194,893 members. Nationally, the average funded ratio for public pension plans tracked by the Public Plans Database is approximately 72–75%. Alabama ERS's funded ratio of 63.7% places it below the national average, indicating elevated fiscal pressure.

How many members does Alabama ERS have?

Alabama ERS covers 194,893 total members, including 85,069 active employees and 57,202 retirees currently receiving benefits. The ratio of active members to retirees is a key indicator of plan sustainability — when the number of retirees grows relative to active contributors, funding pressure increases.

What is the ARC payment percentage for Alabama ERS?

Alabama ERS pays 13.9% of its Annual Required Contribution (ARC). Consistently underpaying the ARC accelerates the growth of unfunded liabilities and places future benefits at greater risk. Employer contribution patterns are tracked annually in the Public Plans Database.

Browse all → | Rankings →

Data sourced from official Public Plans Database and actuarial valuations from federal and state pension systems. See our methodology for details. Retrieved and formatted by Kiznis Studio Editorial

Disclaimer: This information is provided for informational purposes only and does not constitute professional advice. Data is sourced from the Public Plans Database (PPD). Consult a qualified professional before making decisions based on this data.

Read our methodology — how this data is sourced, computed, and verified.

All federal data sources used on this page

U.S. Census Bureau ACS — demographic + housing + income data. census.gov/programs-surveys/acs
BLS Occupational Employment and Wage Statistics (OEWS) — wage + employment by occupation. bls.gov/oes
BEA Regional Economic Accounts — GDP + personal income by state/metro. bea.gov/data/regional
U.S. Census Bureau County Business Patterns — establishment + employment by industry. census.gov/cbp
IRS Statistics of Income (SOI) — tax-return aggregate data. irs.gov/statistics
data.gov — U.S. federal open-data portal — discovery layer for additional federal sources. data.gov