The value of your defined benefit is more important than you think

Everyone's looking for an edge and in retirement planning it's no different. As an INPRS member, your defined benefit (DB) can be a very important piece in your retirement strategy, giving you an edge that many other employment opportunities won't.

Often referred to as your pension, your DB is an increasingly rare benefit to earn from an employer. However, as a public employee whose employer has chosen to offer an INPRS benefit, you have a major advantage when it comes to retirement planning and saving.

Both PERF and TRF Hybrid plans require 10 years of service before a member can earn vested status, which provides for a future guaranteed lifetime benefit. And with few, if any, guarantees available elsewhere, your INPRS DB can give you peace of mind as you near retirement eligibility. Plus, you don’t have to be retired from all work to begin receiving your benefits.
Our Indiana-based team leads INPRS’s efforts in ensuring your earned benefits are ready for you when you retire. Once you meet eligibility requirements, you can count on this monthly payment arriving to you in full for life.¹

Our DB investments are diversified and designed to target a long-term 6.25 percent return over 30 years.²

You can view the value of your pension on your PERF or TRF annual member statement, which you generally receive the month after your birth month. Once you’ve reached five or more years of service with INPRS, we can provide you with the approximate amount of money that you’d need to purchase an annuity with the same monthly benefit you’re currently working toward earning.

To learn more about the benefit of your pension, watch our tutorial.

^{1. Some exceptions include changing your chosen survivor; you may have your pension amount adjusted. Additionally, your pension amount may be reduced or eliminated if you've selected Social Security integration. If this is your situation, you would have agreed to these terms before accepting the benefit. Please contact us if you have questions about your specific INPRS pension benefit.}

^{2. The INPRS Board of Trustees approved the target rate of return of 6.25 percent as of July 1, 2021. For more information, view the 2022 Annual Report.}

Student loan payment pause extension update

Last November, the Biden Administration announced an extension on the federal student loan payment pause.

The U.S. Department of Education is extending the pause until there is a resolution in the courts regarding the administration’s federal student loan relief plan. The pause gives student loan borrowers a break from making monthly payments and accruing interest on their federal student loans.

The payment pause will last until 60 days after the litigation is resolved. If the relief program has not been implemented and the litigation has not been resolved by June 30, payments will resume 60 days later, which is August 29, 2023.

If you haven’t done so already, you can sign up to receive Federal Student Loan Borrower updates from the U.S. Department of Education’s Student Loan Updates. [Updated 1.31.24: Borrowers may no longer sign up to receive Federal Student Loan Borrower updates.]

If you have been taking advantage of the student loan payment pause, start thinking about how your budget may change once the pause is lifted. Consider small changes you can make now, so you can be prepared for what’s next.

Source: Voya Financial

How much is your family's financial security worth to you?

Thinking about death and what that’ll mean for your loved ones can feel morbid, even scary. However unpleasant thinking about it can be, there are simple steps you can take to ensure their financial needs are met.

First, review your beneficiaries listed on your financial accounts. Your retirement accounts, like those with INPRS, investment accounts like your 457(b), 401(a), and those from prior employers provide an option for a named beneficiary.

Choose whoever you like, or even name a trust or estate. With INPRS, you can assign whole percentages to both primary and contingent beneficiaries, giving you flexibility for your beneficiary needs.

Log on to your account at www.myINPRSretirement.org to update your beneficiaries today.

Take the guesswork out of the equation with INPRS's myOrangeMoney® Retirement Calculator

If you’re looking to better understand your future retirement income outlook, check out the myOrangeMoney® retirement calculator. The myOrangeMoney® retirement calculator will show the future monthly income you may need and your progress toward that goal.

Our interactive experience compiles your INPRS benefit, personal savings, and Social Security to give you an estimate of your potential income in your retirement years. Check out our video to see how it works and view more resources, here.

Thinking about retirement? Explore our additional calculators to try different savings and investment return scenarios to help you estimate what your retirement paycheck could be when you plan to retire. If you’re ready to take the next steps toward retirement, we’ll guide you through the process of selecting how you can receive your retirement benefits.

Get to the myOrangeMoney® Retirement Calculators by logging on to your secure account at www.myINPRSretirement.org. We encourage you to review this tool often, especially as your income and retirement plans change.

Target Date Funds may help align your retirement timeline with your retirement dreams

Target date funds, or TDFs, are a part of INPRS’s lineup of investment options. Labeled with the approximate date a member may be expecting to retire or may begin withdrawing benefits, these funds are designed to stick with you as you near retirement.

As you move closer to your target retirement year, the mix of stocks and bonds within each TDF becomes more conservative. INPRS’s TDFs use a “through retirement” glide path construction, which reduces stock exposure and increases bond exposure until 10 years after the assumed retirement date. As with any investment, risks are involved, and the principal value of the fund is not guaranteed at any time.

This past March and April marked INPRS’s annual routine fund adjustment process, where each of our Target Date Funds was updated according to the Funds’ objectives to align with each retirement year. These yearly updates align investment returns and risks with the potential retirement plans of its investors, like you. INPRS members whose plans allow investment choices like the TDFs were informed of these changes on their Q4 2022 statements and via email.

For more details, please review the Target Date Fund fact sheet. Additional information on TDFs and investments can be found on our website.

Things to consider that will shape how you retire

Remember when you bought that one thing that you really didn’t need, and it felt like a waste of money? Chances are you could’ve used that money for something more worthwhile like paying off a debt or even using the money to invest or save for a specific financial goal.

The financial decisions you make today can ultimately have a huge impact on your future – and more specifically, your retirement.

Saving isn’t always easy to do, especially when you have so many other things to do with your money but making the decision to put something aside for tomorrow is a lot easier once you take the time to envision what life in retirement could be if you don’t have enough.

Read more on practical suggestions that can help you make sound financial decisions for today and tomorrow from Voya, our recordkeeper, here.

Source: Voya Financial

The fees you pay as an INPRS member and why

On your member statement, you’ll notice two types of fees INPRS is required to disclose: administrative and investment fees.

While fees aren’t the most fun thing to pay, you can rest assured that INPRS remains committed to operating with an efficiency that will permit these fees to stay low. If the need ever arises to adjust these fees, we’ll let you know in advance of any changes.

Here’s what you need to know about INPRS’s current administrative and investment fees.

ADMINISTRATIVE FEES

• PERF, TRF, and LE DC plan members pay administrative fees to cover the costs associated with managing their defined contribution (DC) accounts.
• Administrative fees are $3.75 deducted directly from members’ DC accounts each month, for an annual charge of $45. This deduction is noted on your quarterly member statement. PERF and TRF Hybrid members will find the fee noted on their annual member statement. This rate has been effective since Jan. 1, 2020, and was approved by the INPRS board of Trustees on Oct. 25, 2019.
• Members of the PERF and TRF My Choice plans have a single defined contribution account from which the fee will be deducted. INPRS predicts that there will be sufficient funds from member forfeitures in the PERF My Choice plans to cover expenses for those plans.
• INPRS’s member fee policy outlines the method used to determine administrative fees.

INVESTMENT FEES / EXPENSE RATIOS

• INPRS Defined Contribution (DC) Plan investment options each carries an “expense ratio.” An expense ratio measures how much you’ll pay over the course of a year to own an investment option. An expense ratio is expressed as a percentage for each investment option.
• When you view your DC account, your online statement will show how much money you gained or lost, known as net of fees. All expenses are deducted from your investment option(s) before showing how much you gained or lost.
• You will find that the expense ratios associated with INPRS are typically lower than retail investment offerings. For example, an INPRS member working for 10 years starting at age 30 could have over $6,000 more in their DC account upon retirement than a retail investor with higher fees on the same investment amount and length of time.*
• You can use the below equation to figure how many dollars you’re paying annually in fees:

Amount Invested (dollars) x Expense Ratio (%) = Fee

For example: if you have $6,000 in a fund with an expense ratio of 0.10%, you’ll pay $6 per year in fees.

* The above example assumes a $1,000 annual investment for 10 years at year-end, starting at age 30 and investing until age 65. Both scenarios assume an 8.00% annualized gross return in a target date fund comparing a typical INPRS expense ratio of 0.10% and a retail target date fund median expense ratio of 0.31%. The rate of return is an assumption and is not a guarantee of performance.

View your investment options and their associated expense ratios by logging into your secure online account at www.myINPRSretirement.org.