The Retirement Board at its October 31 meeting lowered NYSTRS’ assumed rate of return on investments from 7.25% to 7.1%, as recommended by the System’s Actuary. The rate was lowered in response to industry forecasts that it will be more difficult to achieve strong returns going forward. Actuarial assumptions like this one are routinely revised in order to align them with experience and expectations.
According to a February 2019 issue brief prepared by the National Association of State Retirement Administrators (NASRA), more than 30 percent of public pension plans surveyed reduced their assumed rate of return since February 2018. Since the 2010 fiscal year, more than 90 percent lowered their return assumptions.
At June 30, 2019, NYSTRS’10-year return was 10.4% and its 30-year return was 8.8%. The System’s one-year return for the fiscal year ended June 30, 2019 was 7.1%, net of fees.
NYSTRS remains among the best-funded public pension systems in the nation. Using a market value of assets, our most recent funded status was 101%. Using an actuarial value of assets, we were 100% funded.
Over the past 30 years, NYSTRS has paid out $120.2 billion in benefit payments and expenses while collecting $33.4 billion in member and employer contributions. During the same period, the System’s net assets have grown from $23.2 billion to $122.5 billion, with 85% of NYSTRS’ income generated by investment returns.
Also at its October meeting, the Board lowered the assumed rate of future COLA increases to 1.3%, lowered the assumed future inflation rate to 2.2%, and updated the mortality improvement scale.
See the Infographics page of this website for additional System facts and figures. Also see our Pension Education Toolkit.