States across the United States are more financially prepared to weather a recession, with record-high cash reserves that are expected to increase further this year, according to the National Association of State Budget Officers (NASBO).
According to the latest data from NASBO, state reserves, also known as rainy-day funds, increased 58 percent over fiscal 2020 levels, to reach a new high of $121.8 billion in 2021, and continued growth in fiscal 2022 to total $134.5 billion, with 43 states recording year-over-year increases.
Prior to the COVID-19 pandemic, in 2019, rainy-day funds were already at a then-all-time high after decades of saving, NASBO said.
In addition, state reserves are set to rise to $136.8 billion this fiscal year, according to NASBO, which cited enacted budgets for the year. That would represent roughly 12.4 percent of their total spending, leaving them in a better position to handle a volatile economy and fiscal uncertainty….