TRSL annual valuation report
Latest report packed with good news for employers
In October, the TRSL Board approved its annual valuation report that shows a decrease in the unfunded accrued liability (UAL), a rise in the System’s funded level, and falling employer contribution rates. Check out these highlights:
- The UAL decreased to $9.3 billion from $10.3 billion, marking the first time since 2008 it has been below $10 billion. The debt is on track to be paid off by its statutorily required payoff dates.
- TRSL’s funded status increased to 71.8% from last year’s 67.9%. The funded status is a measure of the System’s assets against its liabilities and is a common metric used to gauge a retirement plan’s financial health.
- Employer contribution rates drop for fifth consecutive year. The projected rate for K-12 employers next school year will be 24.8%, down from 25.2% this year; and for higher education employers, the rate will be 24.1%, down from 24.5%.
“We are seeing the fruition of legislative changes that put TRSL in a more secure financial position. It required some hard decisions that are now greatly benefitting our System’s members,” said TRSL Director Katherine Whitney.
Additionally, thanks to a historic 35.7% market return on investments for FY 2021, the System earned an actuarial return of 12.65%, exceeding its target return of 7.45% to fund regular plan benefits. The actuarial return smooths market returns over five years to moderate market volatility and provide a more reliable way to project the plan’s funding needs.
All these numbers—from the strong actuarial return to the lower employer rate—translate to a more secure retirement plan that ultimately benefits TRSL employers and members.