IMRF investments earn 20 percent in 2013 — 96 percent funded at year-end 2013 —
OAK BROOK, Ill. – March 18, 2014 – A stronger economy and a continued bull market for stocks helped the Illinois Municipal Retirement Fund (IMRF) – the best-funded public pension plan in Illinois – earn approximately $5.4 billion on its investment income in 2013. These earnings — as yet unaudited — represent a 20 percent annual rate of return, nearly triple IMRF’s 7.5 percent annual target.
IMRF is 96.1 percent funded in the aggregate on a market value basis (87.4 percent funded on an actuarial basis), and is nearing a 100 percent funding goal last attained in 2007. With the returns, IMRF will credit $1.5 billion of last year’s investment income to IMRF member-employee accounts and the remaining $3.9 billion to IMRF employer accounts.
IMRF ended 2012 with a 13.6 percent rate of return and an 85 percent funded level. The plan’s annualized return has been 10.38 percent since 1982.
“2013’s positive return on investment demonstrates that IMRF continues to recover from the recession,” said IMRF Executive Director Louis W. Kosiba. “These returns will increase the funded status of IMRF employers, lower employer contribution rates and ultimately reduce pension costs to taxpayers.”
IMRF administers retirement, disability and death benefits on behalf of approximately 3,000 local units of government throughout Illinois. It is not one of Illinois’ five state-run public pensions. IMRF’s independent board of trustees, guided by IMRF professional staff and about 80 investment managers, invests in a diversified portfolio that includes a broad mix of domestic and international stocks and bonds, real estate, private equity funds and hedge funds.
In 2013, the average IMRF member retired at age 63 with 20 years of service and an annual pension of $19,718. Every dollar paid to IMRF retirees comes from three sources: investment returns (63 percent), employers (25 percent) and employees (12 percent).
IMRF’s pension payments also support the Illinois economy. Eighty-five percent of IMRF’s 100,000 retirees stay in Illinois. In 2013, IMRF distributed $1.27 billion to retirees in Illinois – including $223 million in Cook County alone.
Finalized investment return data for IMRF will be available in summer 2014.
The Illinois Municipal Retirement Fund (IMRF) was created by the Illinois General Assembly. Since 1941, IMRF has partnered with local units of government to provide retirement, disability and death benefits for public employees. With a funded status of 96 percent and $33 billion in assets, IMRF is well-funded and sustainable. Today, IMRF has about 400,000 members and retirees, and serves nearly 3,000 different units of government, including towns and villages, libraries and park districts, and counties and school districts (non-teaching personnel). The average member who retired in 2013 had 20 years of service and received an annual benefit of about $19,500. For more information, visit www.imrf.org.