By Tom Latek
Kentucky Today
Kentucky teachers’ retirement investments posted the fourth consecutive double-digit gains for the recently concluded fiscal year – 15.04 percent for the Retirement Annuity Trust and 16.06 percent for the Health Insurance Trust.
That follows previous years of 12.27, 10.61, and 12.34 percent for the annuity trust and 12.73, 11.94 and 12.58 percent for the health trust.
“The approach of the TRS Board of Trustees and investment team is disciplined and focused on the best returns in all types of markets,” said TRS Executive Secretary Gary Harbid. “With another year of great returns and continued full funding, for which we’re very appreciative, the retirement security of Kentucky teachers continues to be ensured.”
Returns for the Teachers’ Retirement System of the State of Kentucky (TRS) annuity trust over the last 30 years are 8 percent compounded, which is ahead of the 7.1 percent long-term assumed rate of return. TRS staff presented the pension system’s investment results for the year ended June 30 to the Investment Committee at its Aug. 27 meeting. The net return after fees is 14.75 percent for the annuity trust and 15.79 percent for the health trust.
TRS’s annuity investments for all periods were in the top third compared to peers, with a three-year return in the top decile and a 10-year return in the top 4% of pension plans. All rankings are according to Aon Investments USA’s analysis of large domestic pension plans with more than $1 billion in assets.
During the year, TRS benefited from another year of full funding from the state budget approved by the General Assembly, along with an additional $40 million from the budget reserve trust fund.
TRS, which is regulated under state and federal law, manages more than $36 billion in assets to provide for the retirement income and health insurance of about 140,000 teachers and other education professionals who are members. The teachers’ system pays about $2.7 billion a year in retirement and health care benefits to its members in all 120 Kentucky counties.