Month: September 2023

PERA Board Selects Firm to Conduct Executive Director Search

Posted on by planeteria

The PERA Board is making progress in its search for PERA’s next Executive Director. It formed an ad hoc executive search committee to oversee the process. The committee selected Hudepohl & Associates, a Florida-based firm with expertise in executive searches for public pension plans like PERA, to conduct a nationwide search.

The former Executive Director’s position has been vacant since June 1. Chief Investment Officer/Chief Operating Officer Amy C. McGarrity is serving as Interim Executive Director.

On Tuesday, the committee met to discuss its search timeline and objectives. The committee expects to meet again in early-to-mid October, and the entire process is expected to take several months to complete.

Taylor McLemore, chair of the ad hoc committee, said the committee will consider a wide variety of candidates, both internal and external, to find PERA’s next leader.

“Our mandate is to find the best person for the job,” McLemore said. “This is a significant organization that’s critical to our members, to our employees, and to this state, so we need to find the person who is going to take PERA forward on its mission and make it successful for all of our members and the employees they’re leading.”

Meetings of the ad hoc committee are open to the public and are streamed live on copera.org. PERA members and others are invited to listen in to those meetings, and each includes time for public comment.

For more information, visit copera.org.

News You Should Know: How Pensions Help Address Inequality in Retirement

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Closing the Gap: The Role of Public Pensions in Reducing Retirement Inequality | National Institute on Retirement Security

Saving enough money for retirement can be a challenge, and research has shown women and minorities are more likely to be behind on reaching their savings goals. New research from the National Institute on Retirement Security finds the steady, reliable income in public pension plans like Colorado PERA helps level the playing field in retirement, with the strongest impacts on Black and Latino retirees.

What the Fed’s Interest Rate Pause Means for Mortgages, Savings Accounts and More | Money

The Federal Reserve announced that it is holding its key interest rate steady — for now. Officials say another rate increase is possible before the end of the year, but here’s what to expect in the meantime.

Investment Fraud Soars | Next Avenue

Investment fraud schemes targeting older Americans have skyrocketed, totaling nearly $1 billion in 2022. Experts say limited knowledge of cryptocurrency and other new types of payments is one factor behind the rise. Here are some of the common types of scams to watch out for.

What To Know About IRS’ Catch-Up Contribution Guidance | Investopedia

Late last year, Congress passed a package of retirement-related reforms known as SECURE 2.0. That bill included an important change to catch-up contributions to retirement accounts for workers age 50 and older. The IRS has since said it will allow a grace period of several years to allow people to adjust to the new rules.

News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.

News You Should Know: Colorado Teaming With Maine on State-Run Retirement Plan

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Maine, Colorado Enter Partnership in Offering Automatic Retirement Coverage | ASPPA

Colorado’s state-run retirement plan for private-sector workers whose employers don’t offer one, called Colorado Secure Savings, is joining forces with Maine’s state-run plan. Under the partnership, the two plans will operate separately but the same vendor will serve as administrator for both.

Huge Decline in Spending on Medicare Begs the Question: Why? | Fierce Healthcare

For years, federal spending on Medicare had been on a steep upward climb, but recent data show spending per beneficiary has been more or less flat for the past decade. While the reasons for the change in spending aren’t entirely clear, experts say it could be a combination of various factors, including policy changes and better health in older populations.

Stock Market Drives U.S. Households to Record Wealth | Reuters

While recent headlines have highlighted decreases in Americans’ savings account balances and increases in debt, it’s not all bad news. According to the latest Federal Reserve data, overall household wealth (net worth) reached a new high in the second quarter, driven largely by the stock market and real estate.

Three Overlooked Benefits of Estate Planning | Kiplinger

Many people put off estate planning until later in life — and some don’t even think about it before it’s too late. But it’s an important task that can have many valuable benefits, including some while you’re still around.

News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.

How PERA Prioritizes Financial Value Over Personal or Political Values

Posted on by planeteria

At Colorado PERA, we invest for one purpose: To provide retirement benefits to PERA members for generations to come.

It’s not just our mission, it’s our passion. And it’s the reason we prioritize financial value—not personal or political values—in our investment decisions.

Fiduciary duty

PERA serves nearly 700,000 current and former public employees who have worked hard to make our Colorado communities better places to live. Each of those members counts on PERA to provide a retirement benefit they cannot outlive.

The PERA Board and staff have a fiduciary duty to those members. That means we’re required by law to act solely in the interest of members and benefit recipients, and we must manage the trust funds only for their financial benefit. We make every investment decision with that duty in mind.

Each PERA member is unique, with their own personal values that guide them. It would be impossible to invest based on personal or political values of our individual members or stakeholders. Our fiduciary duty demands that we do what’s right for the membership as a whole, and that means focusing on financial value.

Prioritizing financial value

Our sole investment goal is to pursue the best risk-adjusted returns for our members. That means when we’re researching a possible investment opportunity or assessing an asset we already hold, our focus is on that investment’s ability to earn money over the long term.

We sometimes hear from stakeholders and others who want us to invest in some segments of the market or divest—sell our investments—from others based on their individual preferences or political beliefs.

That would be contrary to our mission and our fiduciary duty. Our approach involves finding companies, properties and investment funds that we believe will be competitive over time, allowing them to be profitable and generate returns to the portfolio.

Investing based on the financial interest of the whole PERA membership is our fiduciary duty, and we take it seriously because our hard-working members depend on us for their financial future.

Learn more about Investment Stewardship:

Recap of PERA Board’s September Planning Session, Meeting

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The Colorado PERA Board of Trustees convened for three days in Colorado Springs for its annual September planning session. The planning session concluded with the Board meeting on Friday, Sept. 22.

Over the course of the three days, Trustees engaged in a number of discussions, education sessions, and planning meetings. Below is a summary of some of the highlights and important actions the Board took.

Executive Director search

The Board committee tasked with overseeing the search for PERA’s next Executive Director announced to the full Board that it has selected an outside firm to assist in that search. Hudepohl & Associates, a firm with experience in executive searches for public pension plans, will conduct a nationwide search over the coming months.

READ MORE: PERA Board Selects Firm to Conduct Executive Director Search

CEM Benchmarking Report

Each year, CEM Benchmarking releases a report comparing PERA to other public pension plans on factors such as plan administration costs and the quality of services provided to members. The most recent report, which CEM presented at the planning session, shows PERA continues to provide a high level of service at low cost to its members relative to its peers.

According to CEM, PERA’s administrative cost was $55 per member in 2022, below the peer average of $63. PERA’s service score of 83 was the 10th highest of the 61 pension systems around the world that were included in the report. Among its peers of similarly sized U.S. plans, PERA ranked fourth.

Notably, the report showed that most plans are seeing an increase in wait times and call lengths on their customer service phone lines in recent years, and PERA is no exception. Staff have been taking steps to improve service levels, including upgrading phone systems and better forecasting staffing needs to meet members’ expectations.

Asset/liability study

An important action the Board undertakes every few years is conducting what’s called an asset/liability study. The last study was completed in 2019.

The asset/liability study is what ultimately informs PERA’s strategic asset allocation — or the mix of stocks, bonds, and other investments that make up PERA’s portfolio.

Over the next several months, PERA’s investment consultants will work with staff and the Board to discuss PERA’s long-term investment goals, risk tolerance, expectations of future performance and other factors to determine if PERA should adjust its asset allocation . A notable change that resulted from the last study was allocating slightly more of the portfolio to global equity.

The Board will discuss the asset/liability study further at its November meeting, with the possibility of finalizing the study as soon as next spring.

The Board will hold its final meeting of 2023 on Nov. 17.