Attention Coordinated Members: Actuarial Factor Changes Effective July 1, 2024

Attention Coordinated Members: Actuarial Factor Changes Effective July 1, 2024

May 9, 2024

The Coordinated Plan’s actuarial factors will be updated for benefit effective dates July 1, 2024 forward. For Coordinated members, these changes may impact your current retirement planning.

Actuarial factors are used to determine benefits when a member elects early retirement, designates a survivor option, or purchases military service credit earned prior to public employment. Factors are subject to change when investment return or mortality rate assumptions change. They may also change when plan provisions change.

For the Coordinated Plan, the factor changes include these updated assumptions:

>>Legislation change of the assumed rate of return from 7.5% to 7.0%,

>>Updated mortality assumptions based on a recent actuarial study for the Coordinated Plan, and

>>Legislation change of the removal of the delayed annual increase from statute.

 

The updated factors will mainly impact early retirement members who choose to collect their retirement benefit closer to age 55. Here is a chart of the impact to early retirement factor changes based on the retirement age:

Age
Estimated Monthly Benefit before Factor Changes
Estimated Monthly Benefit with Factor Changes
Net Dollar Change
Percentage Change
55
1,000
950
-50
-5.0%
58
1,000
959
-41
-4.1%
60
1,000
968
-32
-3.2%
62
1,000
979
-21
-2.1%
64
1,000
994
-6
-0.6%
65
1,000
1,003
3
0.3%
66
1,000
1,000
0
0.0%

 

Please review your myPERA account for updated estimates with benefit effective dates July 1, 2024 forward. Your next annual Personal Benefit Statement will also include updated estimates reflecting this change.

At this time, there are no factor changes to the Police & Fire Plan and the Correctional Plan. These plan’s factors will be reviewed after the completion of actuarial experience studies later this year.