Gunter briefs Retired School Personnel on retirement fund health and influences

Linda Gunter, vice president of North Carolina Retired School Personnel, briefed attendees at the NCRSP Region 3 General Meeting on Tuesday. The meeting was held at South Piedmont Community College in Monroe. NCRSP includes retirees in Anson, Cabarrus, Charlotte-Mecklenburg, Gaston, Lincoln, Montgomery, Rowan, Stanly, and Union counties.

Earlier this year, she was appointed by Governor Roy Cooper to represent retired teachers and school district employees on the Teachers and State Employees Retirement System (TSERS) Board of Trustees.

While the state retirement system remains one of the best-funded systems in America, several factors weigh upon its health, Gunter explained. The increasing number of retirees who draw benefits from the fund, the decreasing number of public employees contributing to the fund, and the trend of retirees living longer, all impact the projections offered by staff members at the retirement system, in the state Treasurer's Office, and at the legislature.

Those projections govern decisions by legislators to afford cost-of-living adjustments (COLAs), which are preferable to one-time "bonuses," she explained. One-time bonuses affect benefits in a single year, but COLAs improve monthly benefits for the rest of a retiree's life. For that reason, it's important that the system remain well-funded.


During the past decade, the legislature has approved only three COLAs, and two one-time bonuses, rather than annual COLAs. By definition, a COLA is intended to help retirement benefits keep pace with cost-of-living increases. But due to a lack of annual COLAs, retirement benefits have lagged behind cost-of-living by 15 percent in the past decade alone.

The retirement system is funded from three sources: employer contributions, employee contributions, and returns on retirement system investments. While contributions from employers (including the state, school districts, counties, and cities and towns) and employees (including state employees, school district employees, and public employees of municipalities) remain stable over time, returns on investments fluctuate annually. The system's diversified investment portfolio includes stocks, bonds, money-market accounts, and real estate (primarily in timber).

Throughout her briefing, Gunter explained the content of several charts, graphs, and spreadsheets produced by the retirement system and by NCRSP officers.

Gunter's presentation and some of the supporting documents are posted below.

(Part 1)

(Part 2)

(Part 3)

(Part 4)

(Part 5)

(Part 6)