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Maybe a trendsetter, Indiana drops the assumed return on its public retirement plan 25 bps to...

Maybe a trendsetter, Indiana drops the assumed return on its public retirement plan 25 bps to just 6.75%, the first of the country's largest 126 pension systems to go below 7%. The return over the last 10 years was 5.74%. "This is a prudent move ... to recognize potential long-term global realities," says the plan's executive director.
 
Comments (8)
  • bbro
    , contributor
    Comments (9330) | Send Message
     
    With Baa yields at 4.83% I wonder what their assumption for equities is??
    8 Aug 2012, 11:05 AM Reply Like
  • Lint
    , contributor
    Comments (391) | Send Message
     
    Laughable. The return has been less that 6% over the last ten years, but they are stating returns of 6.75%. In other words, still lying.
    8 Aug 2012, 11:06 AM Reply Like
  • tomlos
    , contributor
    Comments (1099) | Send Message
     
    Pension systems actually being honest and working? Good luck.. Come to IL and you can see how that's working for us over here. There's a reason why the private sector gave it up a LONG time ago.
    8 Aug 2012, 11:07 AM Reply Like
  • Fr33f0rm
    , contributor
    Comments (300) | Send Message
     
    Pensions aren't a bad thing as long as you have reasonable people making reasonable assumptions. One job I had had a pension plan with a 3% return. It is a return that is achievable and keeps a half step ahead of inflation.

     

    With that rate, banks can support it and make money when times are good, and take small losses when times are bad (ideally, using the profit they made during the good times).

     

    Only the public sector can estimate high and then backfill when they miss time and time again.
    8 Aug 2012, 12:34 PM Reply Like
  • wyostocks
    , contributor
    Comments (7644) | Send Message
     
    A very baby step in the right direction.
    How about a congressional investigation into how the rates are set.
    8 Aug 2012, 11:09 AM Reply Like
  • Lint
    , contributor
    Comments (391) | Send Message
     
    Con-men investigating scammers? No thanks.

     

    How about stating projected returns based on actual returns?
    8 Aug 2012, 11:11 AM Reply Like
  • rambler1
    , contributor
    Comments (398) | Send Message
     
    Agree a step in the right direction. Maybe this can help pressure demands of unionized employees who are bleeding every town, with early pension payouts, Cadillac health insurance, & unrealistic salaries especially in their last 3 years to boost payouts.
    8 Aug 2012, 11:45 AM Reply Like
  • Hendershott
    , contributor
    Comments (1498) | Send Message
     
    Inevitable unless Madoff is running the money.
    8 Aug 2012, 05:00 PM Reply Like
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