Morgan, Author at Colorado PERA

News You Should Know: How the New $6K Deduction for Seniors Works

Posted on July 22, 2025July 22, 2025 by Morgan

What to Know About the New $6,000 Tax Deduction | AARP

The recently passed tax and spending bill known as the One Big Beautiful Bill Act includes a new tax deduction for older Americans. The deduction—up to $6,000 per eligible taxpayer—applies to taxpayers who are 65 or older with a modified adjusted gross income of less than $175,000 ($250,000 for married couples filing jointly). The deduction takes effect for the 2025 tax year and is set to expire after the 2028 tax year.

Colorado Health Insurers Propose Huge Price Increases for 2026 | The Colorado Sun

Insurance carriers are asking the state to approve significant increases in plan premiums for people who buy health insurance on the individual marketplace. On average, insurers are proposing a 28.4% increase for 2026, but that percentage is even higher in more rural parts of the state. PERA staff are still working with carriers to finalize details for PERACare plans and we expect to have 2026 premium information available by October 1.

GENIUS Act: Trump Signs Stablecoin Bill He Championed | Axios

President Donald Trump signed into law a landmark cryptocurrency bill that establishes a regulatory framework for stablecoins, which are a type of digital currency that’s tied to relatively stable assets like the U.S. dollar. Critics have argued the bill doesn’t include enough guardrails or consumer protections, while proponents say the new regulations will pave the way for cheaper, more efficient ways to move money.

Why Gen Z Believes Side Hustles Are Key to a Secure Retirement | Investopedia

Research has shown that younger generations are thinking seriously about retirement and taking action to boost their finances. Not only are members of Gen Z saving for retirement earlier than older generations, but many of them are picking up extra work. A recent survey found over half Gen Z workers have a so-called “side hustle” that helps them pay down debt, save for retirement, and meet other money goals.

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

PERA Board Releases Annual Report, Announces Election Results at June 2025 Meeting

Posted on July 9, 2025July 9, 2025 by Morgan

The Colorado PERA Board of Trustees met on Friday, June 27. The Board released PERA’s annual financial reports, announced the results of Trustee elections, and more.

Annual Comprehensive Financial Report

At its June meeting every year, the PERA Board approves the release of the Annual Comprehensive Financial Report (ACFR) for the previous calendar year. The report contains detailed information on PERA’s financial health, operations, and membership.

As of December 31, 2024, PERA manages an investment portfolio of $66.7 billion for the defined benefit trust funds. The portfolio ended the year with a return of 10.8% net-of-fees. Over the past 30 years, the portfolio has earned an annualized return of 8.4%.

As of the end of the year, the combined funded ratio for the defined benefit trust funds was 69.2%. While that’s a slight decrease from the year before, it’s well within the expected range of volatility.

Based on 2024’s financial results, adjustments via the Automatic Adjustment Provision will not be needed in 2026. That means there will be no adjustments to contribution rates and all eligible benefit recipients will receive a 1.0% increase this July and most, if not all, will receive 1.0% in July 2026.

The ACFR and a summary version, the Popular Annual Financial Report (PAFR), are available online, and an interactive version with report highlights is available at copera.org/snapshot.

Board election results

Another important item the Board completes at its June meeting is releasing the results of Trustee elections. This year, elections were held to fill five seats on the Board:

School Division: Trustees Marcus Pennell and Eunice Botchway were each reelected to 4-year terms and Tonya J. Thompson was elected to a 1-year term.
State Division: Maruti D. Moré was elected to a 4-year term.
Retiree: Tina Mueh was elected to a 4-year term.

Elected Trustees began their terms on July 1.

In addition to the above election results, the Trustees voted to elect Trina Ruhland as Vice Chair of the Board. Trina Ruhland fills the role that was vacated by Hon. Rebecca R. Freyre, who assumed the role of Chair to replace outgoing Chair Taylor McLemore.

Legislative update

Director of Public and Government Affairs Michael Steppat joined CEO/Executive Director Andrew Roth to discuss the recently concluded legislative session. In total, legislators introduced 657 bills over the course of four months, 476 of which passed and were signed into law.

Four of those enacted bills related to PERA. They modify things such as Board terms and meeting rules, the timing of some PERA reports, the employer contribution rate in the Denver Public Schools Division, and funding for voter-approved Proposition 130.

Steppat also briefed the Trustees on upcoming legislative hearings that PERA staff will attend as part of the State’s regular review and oversight of PERA. While the Pension Review Commission and Pension Review Subcommittee won’t be meeting this summer as usual due to a bill pausing interim committee activity, PERA staff will appear before the Legislative Audit Committee in August and the Joint Budget Committee sometime in the fall.

In addition, PERA is awaiting the results of an independent study comparing the cost and effectiveness of the PERA Defined Benefit Plan to alternative plan designs. We expect to receive that study this summer.

Investment performance update

Chief Investment Officer/Chief Operating Officer Amy C. McGarrity and the Board’s investment consultant, Aon, discussed financial markets and economic conditions in 2024 and so far in 2025.

While markets started 2024 with strong positive returns, the second half of the year saw increased volatility, with fixed income and real estate assets in particular struggling to make up losses. In PERA’s portfolio, strong returns from global equities were a major factor in our 10.8% overall return. According to Aon, PERA’s portfolio performed better than 85% of public pension funds in its peer group in 2024, and the 10-year return of 8.3% was better than 95% of the peer group.

In the first quarter of 2025, uncertainty around federal trade policy contributed to market downturns, particularly in global equities. Since then, markets have largely recovered, with both equities and bonds up for the year so far, Aon said.

The PERA Board’s strategic asset allocation and focus on long-term performance has paid off, according to Aon, allowing PERA to beat its benchmark returns over the course of multiple decades.

What’s next?

A recording of the Board meeting and accompanying materials are available at copera.org.

The Board’s next regularly scheduled meeting is the annual planning session from September 17 to 19.

News You Should Know: Social Security, Medicare Finances Worsen

Posted on June 24, 2025August 28, 2025 by Morgan

Medicare and Social Security Go-Broke Dates Pushed Up | AP News

This year’s annual assessment of the Social Security and Medicare trust funds found the programs could be forced to begin cutting benefits even sooner than previously expected, if the government doesn’t take action. Social Security is expected to deplete its trust funds one year sooner than last year’s estimate, while Medicare’s hospital insurance fund is expected to run out of cash three years earlier.

Fed Keeps Rates Steady but Pencils in Two Cuts by End of 2025 | Reuters

The Federal Reserve is cautiously keeping its key interest rate unchanged for the time being due to concerns over inflation ratcheting back up. Chair Jerome Powell said that while inflation has been low in recent months, it’s possible prices will rise as the full effects of tariffs are realized. However, experts say rate cuts later this year are still possible.

Workers Don’t Expect to Succeed in Saving for Retirement | PLANADVISER

If you ask people if their generation has it harder than their parents’ generation, 8 times out of 10 they’ll say “yes,” according to a recent report by the Transamerica Center for Retirement Studies. The survey found that across generations, Americans say they’re struggling to meet their financial needs and save for retirement. The good news is employer-based retirement plans are a vital part of retirement success and more than three-quarters of Generation Z say they’re saving for retirement.

As Colorado Ages, Seniors are Colliding with the Housing Crisis | The Colorado Sun

The Colorado Sun continues its series on aging in Colorado with an article that explores how the state’s seniors—the fastest-growing demographic group—are finding themselves dealing with the housing affordability crisis as they search for homes that meet their needs.

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

Study: Public Pensions Provide Economic Benefits for All

Posted on August 5, 2025August 5, 2025 by Morgan

A recent study by the National Conference on Public Employee Retirement Systems (NCPERS) found that public pensions like Colorado PERA generate local and state tax revenue that far exceed taxpayer contributions to those plans.

The study, “Unintended Consequences: How Scaling Back Public Pensions Puts Government Revenues at Risk,” takes an in-depth look at the costs associated with public pensions, the economic activity they generate, and the implications of shifting workers to other types of retirement plans.

Background

Conversations around the value of public pension plans often focus on the cost of providing a lifetime retirement benefit. Several states have cited potential cost savings in closing or freezing their public pensions in the past, and those states have since faced challenges recruiting and retaining public employees.

The study authors argue that while public pensions can seem like a financial liability when viewed up close, a more comprehensive analysis of their financial impact shows they are in fact significant drivers of economic activity that more than make up for their cost.

How pensions drive economic activity

The NCPERS study highlights two primary ways pensions drive economic activity:

Investments: Public pensions invest their funds in businesses and the financial markets, which in turn create jobs and stimulate economic growth. For every $1,000 invested by a pension fund, NCPERS estimates the economy grows by approximately $2,360. In total, pension investments added an estimated $1.9 trillion to state economies in 2023 and generated approximately $453 billion in state and local tax revenue, according to NCPERS.
Retiree spending: Retirees spend their retirement income on goods and services, and businesses and their employees then turn around and spend that money as well, keeping it circulating and growing throughout the community. NCPERS calculates that retiree spending contributed $980.7 billion to the U.S. economy and generated approximately $208.9 billion in state and local tax revenue in 2023.

Combining the effects of both investments and retiree spending, NCPERS estimates that every dollar taxpayers contribute to public pensions generates $13.41 in economic activity. That means $216.7 billion in taxpayer contributions to pension plans nationwide in 2023 created $661.9 billion in tax revenue and $2.9 trillion in total economic impact, according to NCPERS.

The impact of public pensions in Colorado

Here in Colorado, NCPERS estimates pension assets (including Colorado PERA and others) totaled approximately $70.3 billion in 2023 with about $7 billion in benefit payments throughout the year. Those investments and benefit payments resulted in approximately $25.8 billion in total economic output and generated more than $4.6 billion in state and local tax revenue. NCPERS estimates Colorado’s total net revenue gain from public pensions at $1.78 billion.

As the state’s largest public retirement plan, PERA alone has a significant impact. In 2023, PERA paid $4.56 billion in benefits to 114,432 retirees living in Colorado, resulting in $7.1 billion of the state’s total economic output. Those PERA retirees paid nearly $382 million in state and local taxes on their benefits, supporting schools, roads, and other vital services.

Who benefits from pensions?

As the NCPERS study concludes, reducing benefits or closing pension plans may yield short-term savings, but those actions carry unintended consequences: less money for state and local governments, higher turnover in the public sector, and a less secure retirement for state workers in the long run.

“If there were no public pensions, taxpayers would have to pay more to receive the same level of services,” the NCPERS study authors stated. “Dismantling public pensions would not reduce costs; it would impose new ones.”

At Colorado PERA, we not only provide retirement security to 1 in 10 Coloradans, but contribute to the economic wellbeing of the whole state. Policymakers and stakeholders should view pensions as vital economic engines that benefit everyone by contributing to prosperity at the local, state and federal levels.