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Effective Rates Applied to Employees' Retirement Accounts

The effective rates of interest have been applied to Wisconsin Retirement System active employees' retirement accounts. To learn how the rates affect you, review your latest Statement of Benefits, which was distributed in April.

Both the effective rates and annuity adjustments, which are based on Core and Variable Trust Funds investment performance, are shown below:

 

Core Fund Variable Fund

Final 2016 Calendar Year Investment Return

8.6%

10.6%

Effective Rate (applied to employees' account balances)

7.9%

10.0%

Annuity Adjustment (applied to retirees' monthly payments)

2.0%

4.0%

What are ETF's projections for rates and adjustments next year? While no one can predict future investment performance, all members — retirees and those still working — should prepare for continued volatility and low returns in the investment markets. For retirees in particular, this may mean flat or even negative Core annuity adjustments.

Projected WRS Core Effective Rates and Annuity Adjustments for 2018
  2017 Core Fund Net Investment Return Projected Core Effective Rate Projected Core Annuity Adjustment
Scenario 1 7.2% 6.6% to 7.0% 0.5% to 0.9%
Scenario 2 0.0% 5.2% to 5.6% 0.0% to -.80%
(a loss)

Note: Keep in mind these are projections. Actual rates will be available after final 2017 investment returns have been determined and an actuarial analysis is completed in January 2018.

For more information

  • Sign up for our webinar, WRS Annuity Adjustments and Effective Rates. This 30-minute webinar reviews the annual rate calculation process and how rates affect your benefits.
  • See Core Fund Annuity Adjustments and Effective Rate Projections, a March 2017 presentation to the governing boards of the WRS. This presentation, updated annually by ETF, reviews a range of projected Core effective rates and annuity adjustments using several Core investment return scenarios.
  • Review this table, which shows the relationship between trust fund investment returns and effective rates and annuity adjustments since 1986.