Performance

Reading about the recent financial market news can be unsettling. The situation does not affect individual retirement accounts. Monthly retirement checks do not change based on day-to-day investment performance. Defined benefit plans, like the one offered by the State, are secure because individual benefits are not directly tied to stock market performance.

• If you are a retired member of ERS, your monthly retirement benefit cannot and will not change as a result of any short-term investment loss.
• If you are a contributing member of ERS, your account is not affected by the turmoil in the financial markets. It does not affect the amount of guaranteed interest your retirement account earns each year – currently 5%. This interest rate is established by the State Legislature.
• The companies that are currently in the news have been strong investments for decades.
• ERS investment policies prevent us from investing too much of the trust fund’s money in a particular company. ERS had less than one percent of the trust fund invested in the companies most recently in the news.
• ERS invests in large and small private and public companies throughout Texas, the United States and the world. We also buy corporate and government bonds, and keep a portion of investments in cash.
• ERS invests on a long-term basis with the goal of earning investment returns to help provide retirement benefits guaranteed for the lifetime of State of Texas retirees.

Pension Funds Investment Pool Return (Gross of Fees)

As of February 2012

30 Year Annualized Return: 8.54%

Fund returns and benchmark comparisons on an annualized basis.