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As of January 1, 2007: A snapshot of the MTRS, our current funding status and what we can expect in the near future.
Summary: The demographics of our system illustrate what we have expected and have witnessed over the past few years: the Baby Boomers are moving toward and through retirement. The increased retirements will continue to raise service demands on our system, and the Board and staff will continue to look for ways to respond to the challenges presented by this situation.
Some statistics of interest
Source: PERAC Actuarial Valuation Report, January 2007 (pdf, 33 pages)
Active members
| • Average salary | $55,856 | |
| • Average age | 44.3 years | |
| • Average service | 13.3 years | |
| • Total member compensation | $4.97 billion | |
| • Employee contributions | $480 million |
Retired members
| • Average annual benefit | $32,674 | |
| • Average age | 69.6 years | |
| • Total benefits paid | $1.55 billion |
Our active members, by age
The Baby Boomers are within striking range of retirement.
Our member retirements, FY 2000 – FY 2012:
Actual and projected
In the past five years, more than 18,000 members have retired; over the next five years, we expect the numbers to decrease, but still remain at moderate to high levels.
Our
retired members, by age
This population has never been greater, with the number of older retirees continuing to grow.
Our funding status
Summary: Notwithstanding the down markets of the past few years, the retirement system’s financial position has strengthened over time. The solvency of the system, albeit off its high, is over 50 percent greater since the adoption of the pension funding initiative in 1987. The System is committed to working with the Governor and the Legislature to eliminate the system’s unfunded pension liability.
The asset allocation of the $53.71 billion Pension Reserves Investment Trust (PRIT) Fund (State and Teachers’ Retirement Systems assets) as of December 31, 2007:
| • Domestic equities | 28.51% | |
| • International equities | 19.89% | |
| • Emerging markets | 5.89% | |
| • Fixed income | 17.99% | |
| • High yield debt | 4.55% | |
| • Real estate | 9.36% | |
| • Timber | 2.06% | |
| • Alternative investments | 7.41% | |
| • Absolute return | 4.34% |
To learn more about how the System’s assets are invested, visit www.mapension.com.
Core performance comparison
The Legislature has set 8.25 percent as the pension fund’s long-term rate of return target. The system has averaged 9.9 percent over the past 10 years, and 11.33 percent since its inception in January 1985.
The
MTRS’s funded ratio
Over the years, the system’s funding ratio has increased by 81 percent.
