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PERS Retirement Consultants

Proposed Legislative reform measures could significantly impact Oregon Public Employee Benefits

As the Oregon State Legislature convenes over the course of 2019 and 2020, there are at least 18 PERS Reform measures under consideration. Here is a summary of the proposed changes we are monitoring very closely;

  • Reduction in the Assumed Rate from 7.20% (2018) to 3.50%
  • Reductions in the pension multiplier
  • Final Average Salary (“FAS”), a key component used to estimate your retirement benefit, may be calculated using the highest 5 year salary average instead of the highest 3 year salary average
  • Final average salary cap limit of $100,000
  • Reduction or elimination of sick leave and vacation payouts for the final average salary calculation (would NOT impact OPSRP)
  • Redirecting member contributions
  • OPSRP (aka “Tier 3”) retirement age increased from 65 to 67.  “Early Retirement” increased from age 55 to age 57

In summary, proposed legislative reform measures, pension reform attorneys and extensive research we’ve conducted over several years suggest Oregon PERS Pension Reforms could potentially reduce a member’s lifetime benefit between 10% to 30%.

How Will PERS Reform Effect Me?

Clients have a myriad of risks they face during the three phases of their financial life which are: Accumulation, Preservation of Principal and Distribution.

Financial Professionals must use various forms of risk mitigation strategies toward helping to achieve a client’s investment objectives and strategically limiting potential losses during each phase.

Common forms of risk our clients face everyday include Currency Risk, Inflation Risk and Market Risk.  

With planning, these type of risks may be reduced in severity.

However, Legislative Risk and Headline Risk are essentially heighted risks for Public Employees because there are both economic and political factors that can only be planned for but not reduced in severity.

The key distinction is not when reform happens, but how severe its impact will be. If there is no reform, Oregon PERS may not be able to pay its future liabilities unless it were bailed out by the Federal Government. While a Federal bail out of any state pension system would be unprecedented in nature, it is still a subject making recent headlines.

Since Oregon PERS is in a similar financial condition as California, Illinois, Michigan and New Jersey, you can expect to see more pressure exerted on the legislature to act accordingly.

PERS Concierge Service*

*Neither Haven Financial Group nor PlanMember Securities are endorsed by, directly affiliated with, maintained, authorized, or sponsored by Oregon Public Employees Retirement System.

We have a team of financial professionals located in Bend, Medford and Salem ready to assist you with our exclusive PERS Concierge Service* offering.

Whether you reside in Oregon, or anywhere in the United States, a full array of resources are available to service retiring PERS members including secure phone-video conferencing applications and a third-party language interpretive service designed to facilitate virtually any inquiry including:

  • Hearing or Vision Impaired
  • PERS Disability Retirement Applicants
  • PERS Divorce Settlement Accounts (aka: “Alternate Payees”)
  • PERS Inherited Accounts

The road to your PERS Retirement begins with our one-hour Complimentary Consultation to assess your unique situation