State Treasurer Erick Russell announced Connecticut’s pension funds returned 15.1% in fiscal year 2026, more than double the assumed rate of return, marking the fourth straight year of above-target performance
The state committed $1.304 billion in extra payments toward its pension debt, the seventh consecutive year of such contributions
The pension fund gains and paydown drew national attention, including from Bloomberg, as Connecticut works to improve its credit rating
Connecticut’s pension funds returned 15.1% in fiscal year 2026, more than double the assumed rate of return, State Treasurer Erick Russell announced this month, as the state also made a $1.304 billion payment toward its pension debt.
Russell’s office reported that the Connecticut Retirement Plans and Trust Funds posted the 15.1% return for the 2026 fiscal year, the fourth consecutive year of returns above the assumed rate of 6.9%.
The results “demonstrate the value of maintaining a disciplined, diversified, long-term investment strategy,” Russell said, adding that they “strengthen the retirement security of Connecticut’s teachers and state employees while reducing pressure on future state budgets.”
Russell said the funds’ total assets grew by $11 billion in fiscal year 2026 when factoring in investment earnings and $1.487 billion in excess contributions made after the state’s Rainy Day Fund reached its statutory maximum.
The Treasurer’s office said Russell has worked to reform the funds’ investments, shifting money into low-fee, passive arrangements and increasing investments in areas with high-performing external managers.
The pension return news came around the time Russell’s office reported the state’s commitment of $1.304 billion into the state’s pension funds, with $685.1 million for the State Employees Retirement System and $618.9 million for the Teachers Retirement System.
This marks the seventh year in a row Connecticut has invested in that fund, with total contributions over those seven years being about $11 billion, carving out a significant portion of debt. Another transfer of $114 million is expected when the 2026 fiscal year operating surplus is certified, Russell noted.
The transfer caught national attention from Bloomberg, which noted the state is fighting to improve its credit rating and fiscal situation. Analyst Martin Braun said while other states spend revenue, Connecticut is investing it into owed debt to benefit its future.
