Actuarial Assumptions Changes to Take Effect January 2021
During the August meeting of the COAERS Board of Trustees, the Board voted to approve the final date for implementing the recent changes in actuarial assumptions. The changes will go into effect starting January 1, 2021. Earlier this year, the Board postponed the scheduled July 2020 implementation.
Funding a pension benefit requires the use of projections, known as actuarial assumptions. Actuarial assumptions include economic assumptions, such as long-term rates of investment return, inflation, and salary increases, and demographic assumptions such as rates of retirement and life expectancies. The current adopted assumptions changes may affect several categories of benefits calculations including:
- Service Purchase Calculations
- Partial Lump Sum Calculations
- Early Retirement Reduction Factors for Group B Members
- Joint and Survivor Annuity Factors
- Internal Revenue Code Section 415 Limitations
- Retirees Who Return to Work and Suspend Benefits
COAERS expects the costs for Supplementary, Non-contributory, and Military service purchases to increase beginning January 1, 2021. Members wishing to make these purchases before the cost increases should contact Member Services. Below are the remaining monthly deadlines in 2020 to make these purchases before January 2021:
- September 25, 2020
- October 23, 2020
- November 25, 2020
- December 11, 2020
Whether you are planning for retirement in 2020 or 2021, you can contact our Member Services team for assistance with service purchases and to receive a benefit estimate. Please contact email@example.com or download the request form at www.coaers.org.