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Very Important Memo from the IMRF Executive Director regarding Future Employer Contribution Rates and 2008 Investment Return
The first part of the meeting is discussing what is contained in the memo above.
Other Info from the Meeting:
- 7.5% is what is expected from IMRF investments annually, not met in 2008
- Even with market "rebounding" as of late, does not matter to IMRF investments until Dec. 31, 2009 when assets and liability is valued.
-Rates will likely increase Jan. 1, 2010 with "Phase in rate" (explained in memo) Phase in rates are available to begin in March.
-Employer rates will at most be raised by 10%
-There is a 5 year smoothing technique used for the actuarial value to determine employer contribution rates. This reduces the volatility in rates.
-If there was any over funding in your IMRF account and your surplus reserves are spent, you will have to go to the normal cost. For regular plan is 8.37% of payroll. SLEP is 12.58%. ECO is 25.69%.
-Phase in rate will be evaluated every year and will partially be effected by the market. An increase of 10% is expected each year.
-Employee contributions are set by statute and cannot contribute more money unless the general assembly decides to increase rates. Without an increase in benefits, employee rates cannot be increased.
-IMRF cannot move money like an individual investor and has to be in the stock market for the long term in order to earn the 7.5% annual goal.
-IMRF is 55% stock investment, 45% bond investment currently.
-Call 1800-ASK-IMRF for help with your account
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