According to a study by the Stanford Institute for Economic Policy Research, California public pensions are underfunded by over $500 billion, including the California State Teachers' Retirement System (CalSTRS) and the University of California's retirement system (UCRS).

Along with the California Public Employees' Retirement System (CalPERS), these three plans serve 2.6 million pensioners. In fact, CalPERS and CalSTRS are the 4th and 7th largest pension funds in the world, respectively. The revelation that the systems are underfunded by a half a trillion dollars is a sober truth for the citizens of California.

Why are they underfunded? A recent opinion piece in the Los Angeles Times sheds light on the crime:

"For decades -- and without voter consent -- state leaders have been issuing billions of dollars of debt in the form of unfunded pension and healthcare promises, then gaming accounting rules in order to understate the size of those promises."

Californians can expect at least one, but probably all three, of the following solutions included in the report: reducing benefits for new employees, raising annual contributions to ward off shortfalls and shifting workers to a partial 401k system. For more on this story, click here.

How is the pension system in your state?
How did things get so bad?
Are there other solutions the report didn't include?
Comment below.

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