Department of Employee Trust Funds
January 21, 2014
Projected Rates and Adjustments
On January 13, 2014 the State of Wisconsin Investment Board (SWIB)
announced 2013 preliminary investment returns for the Core and Variable
Trust Funds. The Core Fund ended the year with a preliminary return
of 13.5% and the Variable Fund returned a preliminary 29.0%.
In late February and early March the Department of Employee Trust
Funds (ETF) will announce corresponding effective rates and annuity
adjustments--after final investment returns are determined and an
actuarial analysis is conducted.
Based on the preliminary figures noted above, we anticipate a return
to a positive Core annuity adjustment. The following projections
are based on SWIB’s preliminary investment returns for 2013:
(applied to employees’ account balances)
|11.1% to 11.5%
||29% to 31%
Adjustment (applied to retirees’ monthly payments May
|4.4% to 4.8%
||23% to 25%
- Core Fund gains or losses for each year are “smoothed”
(recognized) in equal increments over five years to cushion the
effect of market volatility. Members in the optional Variable
Fund experience the full effect of market gains or losses—returns
are not smoothed.
- The Core Fund effective rate and annuity adjustment will be
based on investment experience from 2009 to 2013. The effects
of 2008 stock market losses are no longer part of the calculations.
- The Core Fund has exceeded its investment earnings goal in four
of the last five years.
- Monitor our website for news – even better, sign up for
ETF E-Mail Updates to receive instant notification via e-mail.
Look for the red envelope icon on our website to get started.
- For more information, please visit the many resources found
on the Core/Variable
menu of our website.