Benefits Are Changing
KPERS benefits will change starting in 2014. The 2012 Legislature passed changes in response to KPERS' long-term funding shortfall. Although the legislation calls for employers to do the heavy lifting to help fund the system, but some of the weight is on members' shoulders, too.
From the Executive Director
As the U.S. economy continues to make a sustained but slow recovery, we have some good news.
KPERS’ investments had a 14.7 percent total rate of return for calendar year 2012. For fiscal year 2013 through June 30, 2013, the System has earned a total return of 14 percent. Fiscal year 2013 is from July 1, 2012, to June 30, 2013.
Investment returns each year are important, but healthy returns over time are essential for proper funding. KPERS’ 10-year average investment return is 8.1 percent, slightly beating our 8 percent long-term target.
KPERS’ portfolio includes all contributions and net investment earnings on fund assets. As of May 31, 2013, total assets reached $14.2 billion in market value. This is up from a low of approximately $8.8 billion in 2009 as a result of the Great Recession. As a long-term institutional investor, we follow a disciplined asset allocation plan, while managing risk, to generate returns to pay promised benefits – the reason we are here.
KPERS has experienced a fairly steady recovery since the economic crisis in 2008. With continued strong investment returns and the positive effects of last year’s benefit change legislation, KPERS is on a clear path to financial soundness. Projections show the unfunded actuarial liability will be paid off by 2033. While the Retirement System’s unfunded liability will increase somewhat until we see the results of KPERS employer contribution rates catching up with the actuarially required rates, we are solid and headed in the right direction.
As always, we welcome your comments and questions. Please feel free to contact me anytime at 785-296-1019, or firstname.lastname@example.org.
5 Financial Numbers to Know
Staying in sound financial shape requires more than just knowing the balance of your checking account.
When we talk about personal finance, we toss around a lot of terms: APRs, credit scores, mortgage principals . . . you get the idea. It's easy to get lost in all these numbers, so we're here to break it down for you.
These five may be the most important. They're the difference between a healthy bank account and debt collectors knocking at your door:
- Issue Brief: Important Changes in Pension Accounting and Financial Reporting for KPERS Employers (PDF, 163KB)