What is Unfunded Pension Liability?
Unfunded Pension Liability meaning in finance terminology / glossary / dictionary is:
Unfunded pension liability is the difference between the value assigned to the retirement benefits already earned by a municipality’s employees and the assets the local retirement system will have on hand to meet these obligations. The dollar value of the unfundedpension liability is redetermined every three years and is driven by assumptions about interest rates at which a retirement system’s assets will grow andthe rate of future costs of living increases to pensioners. (See Pension Plan)
reference: Massachusetts Department of Revenue: Municipal Finance Glossary, May 2008