
<p>Retirement insights from a Colorado PERA perspective</p>



<p></p>


A distant view shows a mountainous landscape with sloping peaks, green trees in the foreground, and a cloudy sky above.


<h4 class="wp-block-heading"><a href="https://www.pbs.org/newshour/economy/how-the-stock-market-defied-expectations-in-2024-by-the-numbers" target="_blank" rel="noreferrer noopener"><strong>How the Stock Market Defied Expectations in 2024, by the Numbers | PBS News</strong></a></h4>



<p>2024 was a great year for the stock market. The S&amp;P 500, for example, notched dozens of all-time records as stocks soared throughout the year. Here are more notable numbers from the market’s performance. Note that PERA’s 2024 investment performance data won’t be available until the <em>Annual Comprehensive Financial Report</em> is released in June.</p>



<h4 class="wp-block-heading"><a href="https://finance.yahoo.com/personal-finance/banking/article/do-we-want-high-or-low-interest-rates-223031516.html" target="_blank" rel="noreferrer noopener"><strong>Understanding the Fed&#8217;s Rate Decisions: Do We Want High or Low Interest Rates​? | Yahoo Finance</strong></a></h4>



<p>The past several years have been notable for the Federal Reserve’s interest rate moves—the Fed began raising its key interest rate in 2022 and it remained high through much of 2024 before the Fed began lowering the rate in September. It’s not always easy to understand the implications of these decisions, so here are some pros and cons of high and low interest rates for various financial situations.</p>



<h4 class="wp-block-heading"><a href="https://www.cnbc.com/2025/01/05/how-to-maximize-your-401k-for-2025.html" target="_blank" rel="noreferrer noopener"><strong>Here&#8217;s How to Maximize Your 401(k) Plan for 2025 with Higher Limits, Bigger Catch-Up Contributions | CNBC</strong></a></h4>



<p>If you’re saving additional money for retirement in a PERAPlus 401(k) or 457 Plan, you have the opportunity to boost your savings even more this year. The amount of money you can contribute to those plans is going up in 2025, and there’s also a new, higher catch-up contribution limit for workers who are getting closer to retirement.</p>



<h4 class="wp-block-heading"><a href="https://www.investopedia.com/how-to-make-financial-resolutions-you-can-stick-to-in-2025-8762615" target="_blank" rel="noreferrer noopener"><strong>How To Make Financial Resolutions You Can Actually Stick To In 2025 | Investopedia</strong></a></h4>



<p>It’s that time of year when many of us are setting intentions and resolutions for the new year. If you’re making money goals, here are some tips for making sure they’re realistic and achievable so you’re set up for success.</p>



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<p><em>News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.</em></p>


News You Should Know: The 2024 Stock Market by the Numbers


<h4 class="wp-block-heading"><a href="https://finance.yahoo.com/news/fed-schmid-says-uncertain-far-183000678.html" target="_blank" rel="noreferrer noopener" class="broken_link"><strong>Fed Officials Fret Over How Far They Can Lower Interest Rates | Bloomberg via Yahoo! Finance</strong></a></h4>



<p>What will the Federal Reserve do next? It appears even Fed officials aren’t sure, given their comments at a recent conference. While it’s likely we’ll see additional interest rate cuts in the future, it’s unclear how low they’ll go, as officials have suggested the rate needed to keep inflation in check may be higher than in the pre-pandemic years.</p>



<h4 class="wp-block-heading"><a href="https://www.planadviser.com/retirement-benefits-valued-workers-last-year/" target="_blank" rel="noreferrer noopener"><strong>Retirement Benefits Valued by More Workers Than Last Year | PlanAdviser</strong></a></h4>



<p>Retirement benefits have grown in importance to workers, according to a recent survey. That survey found 62% of respondents said retirement plans contributed most to their financial security, up from 56% the year before. Other priorities included health insurance and paid time off.</p>



<h4 class="wp-block-heading"><a href="https://www.cnbc.com/2024/11/11/credit-card-debt-among-retirees-jumps-significantly.html" target="_blank" rel="noreferrer noopener"><strong>Credit Card Debt Among Retirees Jumps | CNBC</strong></a></h4>



<p>New poll data shows just how much retirees’ credit card debt has grown in recent years. According to the Employee Benefit Research Institute, 68% of retirees had outstanding credit card debt in 2024, up from 40% just two years ago. In general, EBRI says retirees and those approaching retirement today are much more likely to have debt—and more of it—than in the past.</p>



<h4 class="wp-block-heading"><a href="https://www.nextavenue.org/guide-model-for-dementia-caregivers/" target="_blank" rel="noreferrer noopener"><strong>GUIDE Model Offers Hope, Support for Dementia Caregivers | Next Avenue</strong></a></h4>



<p>The Centers for Medicare and Medicaid Services is rolling out a major initiative known as Guiding an Improved Dementia Experience (GUIDE). The new framework aims to fill existing gaps in dementia care and support for caregivers—including training and education, financial assistance for caregiver breaks, and better access to around-the-clock virtual care.</p>



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<p><em>News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.</em></p>


News You Should Know: Fed Charting Uncertain Course with Interest Rates


<p>The Colorado PERA Board of Trustees convened for its final regular meeting of 2024 on Friday, November 15.</p>



<p>Below are summaries of some of the key actions the Board took during the meeting. You may also view a <a href="https://www.youtube.com/live/PEsqqE25_w0?feature=share" target="_blank" rel="noreferrer noopener">recorded livestream</a> of the meeting.</p>



<h4 class="wp-block-heading"><strong>PERA operating budget</strong></h4>



<p>Following a budget workshop during which PERA executives briefed the Board on the need for a larger budget to cover important technology upgrades, the Board approved PERA’s 2025 operating budget of $132 million. The 19.6% increase over 2024’s budget includes costs associated with a multi-year project to modernize the core technology systems necessary to administer benefits as well as other critical needs.</p>



<p>Read more about <a href="https://www.copera.org/news/colorado-pera-board-approves-increase-in-operating-budget-to-fund-technology-upgrades" target="_blank" rel="noreferrer noopener">PERA’s 2025 budget</a>.</p>



<h4 class="wp-block-heading"><strong>Strategic planning update</strong></h4>



<p>For months now, the Board, PERA staff, and consultants have been working together to develop PERA’s next three-year strategic plan. That process has involved stakeholder research, identifying areas of strength and opportunity, and solidifying long-term priorities and goals for the organization.</p>



<p>From here, work will continue on crafting the plan, with a draft expected to be ready for Board review in January. Once approved, it will be up to staff to begin implementing the plan and fulfilling its strategic vision.</p>



<h4 class="wp-block-heading"><strong>Member contribution interest rate</strong></h4>



<p>Every PERA Defined Benefit Plan account accrues interest, compounded annually. If a PERA member <a href="https://copera.org/welcome-pera-members/life-and-job-changes/leaving-employment" target="_blank" rel="noreferrer noopener">leaves PERA-covered employment</a> and requests a refund of their account, they receive their contributions, the interest earned on that balance, and any applicable employer match. If that member keeps their account with PERA, the balance will continue to accrue interest and the member has multiple options upon reaching retirement eligibility, including choosing a lifetime monthly benefit.</p>



<p>The Board is responsible for setting the interest rate every year; it currently stands at 3 percent. The Board’s policy evaluates the interest rate as a component of members’ overall retirement benefit. After discussing the issue, Trustees voted to keep the interest rate at 3 percent for 2025.</p>



<h4 class="wp-block-heading"><strong>Trustee appointment and Board officer election</strong></h4>



<p>The Board held elections to name a new Chair and Vice Chair, as terms for current Chair Marcus Pennell and Vice Chair Taylor McLemore are set to expire. Current Vice Chair Taylor McLemore was elected Chair, and the Hon. Rebecca R. Freyre was elected Vice Chair. Outgoing Chair Marcus Pennell served the limit of two terms as Chair and was ineligible for reelection.</p>



<p>Both McLemore and Freyre will serve two-year terms.</p>



<p>In addition to electing new officers, the Board appointed Dr. Louis Fletcher to fill a School Division seat vacated by Trustee Scott Smith in September. Fletcher had the second-highest number of votes in the 2024 election for that seat, and will serve until the next election in 2025.</p>



<p><strong>READ MORE:</strong> <a href="https://www.copera.org/news/pera-board-elects-new-chair-vice-chair" target="_blank" rel="noreferrer noopener">PERA Board Elects New Chair, Vice Chair</a></p>



<h4 class="wp-block-heading"><strong>Denver Public Schools “true-up” discussion</strong></h4>



<p>When legislation was passed to merge Denver Public Schools Retirement System into Colorado PERA in 2010, it included a provision that aims to equalize the ratio of unfunded actuarial accrued liability over payroll of the DPS Division and the School Division in 30 years. Every five years, PERA conducts an analysis of those ratios and whether adjustments to the DPS Division employer contribution rate would be needed to stay on track.</p>



<p>The results show that a reduction in the DPS Division’s employer contribution rate would be necessary to equalize this ratio in 2039, but the PERA Board has previously taken a formal stance in opposition to the defunding provisions—such as the 5-year “true-up”—that were included in the merger legislation, and more recently has opposed any legislation seeking to reduce contributions pursuant to the Board&#8217;s funding policy.</p>



<p>Additionally, a reduction in employer contributions from the DPS Division could increase the possibility of triggering the Automatic Adjustment Provision in future years, which could increase contributions in other divisions and further decrease the Annual Increase retirees receive on their retirement benefit.</p>



<h4 class="wp-block-heading"><strong>Upcoming legislative session</strong></h4>



<p>Director of Public &amp; Government Affairs Michael Steppat and Chief Executive Officer/Executive Director Andrew Roth provided the Trustees with an update on interim legislative activity and PERA-related bills that could be introduced in the upcoming 2025 legislative session.</p>



<p>The&nbsp;<a href="https://leg.colorado.gov/committees/pension-review-commission/2024-regular-session" target="_blank" rel="noreferrer noopener">Pension Review Commission</a>, which is responsible for recommending legislation pertaining to PERA and the Fire and Police Pension Association of Colorado, drafted two bills for the 2025 session.</p>



<p>The first, known as Bill A, is similar to a bill from last session that would provide a temporary tax credit for PERA retirees to reduce the impact of inflation. The second draft, Bill B, pertains to PERA studies and reporting and aims to lay out in statute some of the work the PERA Board already does on a regular basis and modify the cadence of those reports.</p>



<p><strong>READ MORE:</strong> <a href="https://www.copera.org/pera-on-the-issues/state-lawmakers-pursuing-two-pera-related-bills-in-2025" target="_blank" rel="noreferrer noopener">State Lawmakers Pursuing Two PERA-Related Bills in 2025</a></p>



<h4 class="wp-block-heading"><strong>Actuarial experience study</strong></h4>



<p>In order to accurately estimate PERA’s financial status and how much money is needed to provide benefits now and into the future, we use a set of predictions, known as actuarial assumptions, that undergo regular review and updates as needed. Those assumptions include economic factors like inflation, investment returns and payroll growth, as well as demographic assumptions such as when people retire and how long they’ll live.</p>



<p>The process of reviewing those assumptions is known as an actuarial experience study, so called because the study involves comparing PERA’s assumptions with the actual experience over a set time period. The last experience study <a href="https://www.copera.org/pera-on-the-issues/2020-experience-study-preparing-for-a-secure-future" target="_blank" rel="noreferrer noopener">took place in 2020</a>. While nobody can predict the future perfectly, regularly performing experience studies ensures our estimates of current and future benefit obligations are as accurate as possible.</p>



<p>The current experience study will look at the period between January 1, 2020 and December 31, 2023. This is an important period because it will show the effects of the COVID-19 pandemic, such as higher mortality and earlier retirements.</p>



<p>Over the coming months, PERA staff will continue working with actuarial consultants to conduct the study, after which the consultants may recommend changes to some assumptions. If the Board adopts any recommended changes, we’ll be sure to provide an update on what that might mean for PERA’s finances.</p>



<h4 class="wp-block-heading"><strong>2025 Board election</strong></h4>



<p>The Board’s final action item was approving the calendar for next year’s Board election.</p>



<p>There will be five seats up for election in 2025: Three active member seats in the School Division, one active member seat in the State Division (excluding higher-education employers), and one retiree seat (School, Local Government, and Judicial Divisions only). Candidacy will open in early January, with the election taking place in May.</p>



<p>New in 2025, members and retirees will have the added option of being able to cast their votes via the Colorado PERA <a href="https://www.copera.org/pera-mobile-app" target="_blank" rel="noreferrer noopener">mobile app</a> or on copera.org, in addition to the option to vote by mail.</p>



<p>The Board’s next regularly scheduled meeting will take place on January 17, 2025.</p>


PERA Board Approves Budget, Member Interest Rate and More at November 2024 Meeting


<h4 class="wp-block-heading"><a href="https://www.nerdwallet.com/article/finance/when-the-fed-cuts-rates" target="_blank" rel="noreferrer noopener"><strong>What Happens Now That the Fed Finally Cut Rates? | NerdWallet</strong></a></h4>



<p>Federal Reserve Chair Jerome Powell recently announced the central bank would lower its key interest rate for the first time since 2020. While a rate cut was expected, some were surprised by the Fed’s decision to slash the rate by 0.5% instead of a more incremental 0.25%. Here’s what lower interest rates could mean for your finances and the economy as a whole.</p>



<h4 class="wp-block-heading"><a href="https://www.govexec.com/pay-benefits/2024/09/lawmakers-successfully-force-vote-eliminating-windfall-elimination-provision/399759/" target="_blank" rel="noreferrer noopener"><strong>Lawmakers Successfully Force a Vote on Eliminating the Windfall Elimination Provision | Government Executive</strong></a></h4>



<p>The federal lawmakers leading the charge on H.R. 82—aka the Social Security Fairness Act, which would repeal the Windfall Elimination Provision (WEP) and Government Pension Offset (GPO)—have succeeded in their efforts to force a floor vote on the issue. Reps. Abigail Spanberger (D-VA) and Garret Graves (R-LA) used a rare tactic called a discharge petition, which reached the necessary threshold of 218 signatures to bypass Congressional leadership and get a vote on the floor of the House of Representatives. A vote likely won’t happen until at least November, and the bill would still have to pass the Senate before the conclusion of this Congress in January.</p>



<h4 class="wp-block-heading"><a href="https://www.cnbc.com/2024/09/24/september-consumer-confidence-falls-the-most-in-three-years.html" target="_blank" rel="noreferrer noopener"><strong>September Consumer Confidence Falls the Most in Three Years | CNBC</strong></a></h4>



<p>The latest survey data show American consumers are increasingly pessimistic about the current and future state of the economy. According to the monthly Conference Board report, its consumer confidence index dropped to 98.7 in August, marking the biggest single-month decline since 2021. Survey respondents largely cited the weakening job market and the effects of inflation as their main concerns.</p>



<h4 class="wp-block-heading"><strong><a href="https://www.ecu.edu.au/newsroom/articles/research/travel-could-be-the-best-defence-against-ageing" target="_blank" rel="noreferrer noopener">Travel Could Be the Best Defense Against Aging | Edith Cowan University</a></strong></h4>



<p>If your retirement plans include travel, you could be doing yourself the favor of improving your health and slowing down the aging process. According to new research from Edith Cowan University in Australia, the pleasure we derive from travel activities—such as unplugging from daily life, getting more exercise, and having new experiences—can help alleviate stress and boost our overall functioning, which can help slow down the clock in terms of aging.</p>



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<p><em>News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.</em></p>


News You Should Know: What Lower Interest Rates Mean For Your Finances


<h4 class="wp-block-heading"><a href="https://www.ncpers.org/costs-of-pension-reforms-income-inequality" target="_blank" rel="noreferrer noopener"><strong>The Hidden Costs of Pension Reforms: Rising Income Inequality, Lagging Economic Growth | National Conference on Public Employee Retirement Systems</strong></a></h4>



<p>Changes to the defined benefit pension landscape—including the shift from pensions to defined contribution plans like 401(k)s in the private sector—have contributed to worsening income equality among retirees over the years, according to new research. The study, from the National Conference on Public Employee Retirement Systems, also concluded that income inequality has an overall negative effect on the economy by limiting growth.</p>



<h4 class="wp-block-heading"><a href="https://apnews.com/article/interest-rates-prices-inflation-federal-reserve-economy-2cd182eb34a7d6772ff573bec0bcf64d" target="_blank" rel="noreferrer noopener"><strong>Jerome Powell Says Fed to Soon Begin Reducing Interest Rates | AP News</strong></a></h4>



<p>Federal Reserve Chairman Jerome Powell confirmed he’s ready to start lowering interest rates. At the Fed’s annual conference in Wyoming, Powell said it’s time for policy to adjust as inflation has eased and the job market has cooled. Though Powell didn’t specify when the central bank will start to lower rates, many experts expect the first cut to come when the Federal Open Market Committee meets in September.</p>



<h4 class="wp-block-heading"><a href="https://www.cpr.org/2024/08/25/colorado-talk-about-dementia-campaign/" target="_blank" rel="noreferrer noopener"><strong>Colorado Hopes to Raise Awareness of Dementia, Start Conversations, With New Campaign | Colorado Public Radio</strong></a></h4>



<p>The Colorado Department of Public Health and Environment is launching a new campaign called “Talk About Dementia.” The campaign aims to raise awareness about dementia, including Alzheimer’s disease, which can often go undiagnosed. Since early detection can be important for treatment, officials hope the campaign can help lessen dementia’s impact in the state.</p>



<h4 class="wp-block-heading"><a href="https://www.thinkadvisor.com/2024/08/15/long-term-care-costs-emerge-as-a-top-issue-for-older-americans/" target="_blank" rel="noreferrer noopener"><strong>Long-Term Care Costs Emerge as a Top Issue for Older Americans | ThinkAdvisor</strong></a></h4>



<p>Paying for health care is one of the top concerns for retirees and those who are preparing for retirement. A new survey of Americans aged 50 and older found people are especially concerned about the cost of home care, assisted living, and nursing home care. The cost of acute medical care was the second-highest concern, followed by the cost of prescription medications.</p>



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<p><em>News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.</em></p>


News You Should Know: Income Inequality Rises with Decrease in Pension Access, Study Finds


<h4 class="wp-block-heading"><a href="https://www.npr.org/sections/shots-health-news/2024/08/15/nx-s1-5075659/medicare-negotiated-drug-prices-for-the-first-time-heres-what-it-got" target="_blank" rel="noreferrer noopener">Medicare Negotiated Drug Prices for the First Time. Here’s What It Got. | NPR</a></h4>



<p>Medicare has revealed the results of its first-ever negotiated drug prices. Officials have been negotiating with pharmaceutical companies for months, and that process just wrapped up, resulting in discounts on popular drugs for diabetes, cancer, arthritis, and other ailments. The new lower prices for the first batch of 10 prescription medications will take effect in 2026.</p>



<h4 class="wp-block-heading"><a href="https://coloradosun.com/2024/08/15/colorado-special-session-property-taxes-election-2024/" target="_blank" rel="noreferrer noopener">Colorado Governor Calls Special Session on Property Taxes to Avoid Ballot Measure Fight in November</a></h4>



<p>Gov. Jared Polis called for a special legislative session to tackle the issue of property taxes in Colorado. Various advocacy groups had been calling on the legislature to take action and pass a bill to lower taxes rather than allow two tax-related initiatives to appear on the November ballot.</p>



<h4 class="wp-block-heading"><a href="https://www.reuters.com/markets/rates-bonds/size-looming-fed-rate-cuts-may-hinge-job-market-2024-08-02/" target="_blank" rel="noreferrer noopener"><strong>Fed Rate Cuts Loom Large as US Job Market Slows Sharply | Reuters</strong></a></h4>



<p>Prior to early August’s monthly jobs report, many analysts said the Federal Reserve would be likely to start lowering interest rates in September. That jobs report showed a noticeable increase in unemployment, signaling a weakening job market and all but guaranteeing a rate cut in the very near future.</p>



<h4 class="wp-block-heading"><a href="https://www.plansponsor.com/milliman-reveals-health-care-costs-for-65-year-olds-retiring-in-2024/" target="_blank" rel="noreferrer noopener"><strong>Milliman Reveals Health Care Costs for 65-Year-Olds Retiring in 2024 | PLANSPONSOR</strong></a></h4>



<p>A new report highlights the rising cost of retiree health care. According to the Milliman Retiree Health Cost Index, the amount of savings needed to cover health care costs for a couple retiring in 2024 has increased by $7,000 in the past year if that couple is enrolled in original Medicare with supplemental coverage. On the other hand, retirees with Medicare Advantage plans need less money saved up in order to pay for care.</p>



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<p><em>News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.</em></p>


News You Should Know: Medicare Wraps Up Drug Price Negotiations


<h4 class="wp-block-heading"><a href="https://www.9news.com/article/news/local/local-politics/new-colorado-laws-effect-july-1-2024/73-fa0723cb-9ee3-4666-9d67-851b0a130aef" target="_blank" rel="noreferrer noopener"><strong>New Colorado Laws Go Into Effect July 1, 2024 | 9News</strong></a></h4>



<p>During the recently concluded legislative session, state lawmakers passed more than 500 bills and sent them to Gov. Jared Polis for action. Of the bills signed into law, some are now starting to go into effect. Here are details on new laws taking effect July 1, including one pertaining to PERA retirees returning to work in school districts.</p>



<h4 class="wp-block-heading"><a href="https://www.marketplace.org/2024/06/12/elevated-interest-rates-rate-hike-lagging-effect/" target="_blank" rel="noreferrer noopener"><strong>The &#8220;Lag Effect&#8221; of High Interest Rates is Playing Out | Marketplace</strong></a></h4>



<p>When the Federal Reserve began raising interest rates in an effort to tamp down inflation in 2022, it did so with the understanding that the effects of higher rates would take some time to be realized. Experts say we’re now seeing some of those effects, though relief in the form of lower rates may not come as soon as previously expected.</p>



<h4 class="wp-block-heading"><a href="https://www.cnbc.com/2024/06/13/dont-just-set-it-and-forget-it-how-to-do-a-mid-year-financial-checkup.html" target="_blank" rel="noreferrer noopener"><strong>Don’t &#8216;Just Set It and Forget It&#8217;: How To Do a Mid-Year Financial Checkup | CNBC</strong></a></h4>



<p>We’re halfway through 2024, and it’s a great time to pause and take stock of your financial situation for the year so far and gauge your progress toward meeting any goals you might have made. Taking a look at your cash flow, account balances, and even thinking ahead to next year’s tax returns can all help you make sure you’re on the right track.</p>



<h4 class="wp-block-heading"><a href="https://www.morningstar.com/retirement/8-little-known-facts-about-required-minimum-distributions" target="_blank" rel="noreferrer noopener"><strong>8 Little-Known Facts About RMDs | Morningstar</strong></a></h4>



<p>If you’re retired, you’re probably familiar with required minimum distributions (RMDs) which are retirement account withdrawals you have to take from plans like IRAs and 401(k)s each year once you reach a certain age. But knowing when to start taking them and how much to withdraw can be a challenge, especially as rules change. Here are some tips and some common misconceptions about RMDs.</p>



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<p><em>News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.</em></p>


News You Should Know: New Laws Going Into Effect July 1


<p>Saving money is always a good idea. Whether it’s for a rainy day or for a major purchase, saving now can help provide flexibility and security when big expenses come down the road.</p>



<p>April 8 through April 12 is&nbsp;<a href="https://americasavesweek.org/" target="_blank" rel="noreferrer noopener">America Saves Week</a>, an annual initiative of the Consumer Federation of America, a nonprofit consumer advocacy organization. It promotes the value of saving money and the importance of making a plan to save.</p>



<p>Beyond peace of mind, here are some additional reasons to consider stashing away some more money this year, if you can.</p>



<h4 class="wp-block-heading"><strong>Take advantage of high interest rates</strong></h4>



<p>The Federal Reserve started raising its key interest rate in March 2022 in an effort to fight inflation. Increases continued throughout 2023, and so far this year, the Fed is holding rates steady.</p>



<p>While the Federal Reserve rate mostly pertains to financial institutions, many banks have passed on those higher rates to their customers. That means interest rates on many savings accounts and certificates of deposit (CDs) are higher than they’ve been in years.</p>



<p>Some high-yield accounts, especially those offered by online banks, advertise rates of 5% annual percentage yield (APY) or higher. On a $5,000 account balance, 5% APY can result in $250 in interest earnings over the course of a year. That extra cash from interest could help you reach your goals faster or help you pay for an unexpected expense.</p>



<h4 class="wp-block-heading"><strong>You may be eligible for a tax break</strong></h4>



<p>If you make pre-tax contributions to a retirement plan such as an IRA, 401(k), or 457 plan, you may already be reducing your taxable income. But you may also qualify for an additional tax break for a portion of your contributions, based on your income.</p>



<p>The&nbsp;<a href="https://www.irs.gov/retirement-plans/plan-participant-employee/retirement-savings-contributions-savers-credit" target="_blank" rel="noreferrer noopener">Retirement Savings Contributions Credit</a>, also known as the Saver’s Credit, offers a credit between 10% and 50% of eligible retirement plan contributions (for a maximum credit of $1,000 for single filers or $2,000 for joint filers).</p>



<p>For tax year 2023, the maximum income for a single filer to qualify for the Saver’s Credit is $36,500 ($73,000 for joint filers).</p>



<h4 class="wp-block-heading"><strong>Boost your retirement security</strong></h4>



<p>PERA members are already setting aside money for retirement with every paycheck. Members in the PERA&nbsp;Defined Benefit&nbsp;Plan can count on PERA to provide monthly retirement income for life, but you’ll never regret having more money available in your golden years.</p>



<p>Whether you’re saving in a traditional savings account, an employer-based plan such as a <a href="https://content.copera.org/retirees/peraplus-401-k-457-plans/" target="_blank" rel="noreferrer noopener">PERAPlus 401(k) or 457 Plan</a>, or even a health savings account (HSA) if eligible, additional savings can provide the flexibility to cover expenses that are hard to plan for. That could include costs like health care—one of the biggest (and growing) expenses—in retirement, long-term care, family needs, and housing.</p>



<p>Colorado PERA will be sharing more information and tips for America Saves Week on social media, so be sure to join the conversation on&nbsp;<a href="https://www.facebook.com/ColoradoPERA/" target="_blank" rel="noreferrer noopener" class="broken_link">Facebook</a>&nbsp;and&nbsp;<a href="https://www.copera.org/do-you-have-a-savings-plan-for-2023" target="_blank" rel="noreferrer noopener" class="broken_link">Instagram</a>.</p>


America Saves Week: Three Reasons to Save More This Year


<h4 class="wp-block-heading"><a href="https://www.usatoday.com/story/news/health/2024/02/01/biden-administration-launches-medicare-drug-price-negotiations/72411019007/" target="_blank" rel="noreferrer noopener"><strong>Medicare Drug Price Negotiations Kick Off with Price Offers on These 10 Drugs | USA Today</strong></a></h4>



<p>The federal government’s long-awaited drug price negotiations are now underway. The government isn’t releasing its initial offers, but it has released the initial list of drugs in question. The final negotiated prices will take effect in 2026.</p>



<h4 class="wp-block-heading"><a href="https://www.cbsnews.com/news/fed-chair-jerome-powell-interest-rates-60-minutes-transcript/" target="_blank" rel="noreferrer noopener"><strong>Fed Chair Jerome Powell Shares Why Fed Hasn&#8217;t Yet Cut Interest Rates | CBS News</strong></a></h4>



<p>Many experts expect the Federal Reserve to begin cutting interest rates this year, but Chair Jerome Powell say the Fed isn’t ready to do so just yet. While prices aren’t rising as quickly as they had been, Powell says he wants to see more evidence that inflation is down and staying down.</p>



<h4 class="wp-block-heading"><a href="https://www.adn.com/politics/alaska-legislature/2024/01/31/alaska-senate-advances-public-sector-pension-plan-to-address-recruitment-and-retention-crisis/" target="_blank" rel="noreferrer noopener"><strong>Alaska Senate Advances Public-Sector Pension Plan to Address Recruitment and Retention Crisis | Anchorage Daily News</strong></a></h4>



<p>Alaska closed its public employee pension plan in 2006, and since then the state has struggled to attract and retain workers in important roles like teachers, firefighters, and police officers. A bill that would create a new pension plan is now making its way through the state legislature. It has passed the Senate and how heads to the House for further deliberation.</p>



<h4 class="wp-block-heading"><a href="https://www.cnn.com/2024/02/05/economy/loud-budgeting-financial-trend-tiktok/index.html" target="_blank" rel="noreferrer noopener"><strong>Loud Budgeting is In, Quiet Luxury is Out. Meet the TikToker Who Started the Financial Trend | CNN Business</strong></a></h4>



<p>You may have heard the term “quiet luxury,” but younger generations are starting to embrace its opposite—loud budgeting. It started out with a joke on TikTok, but creating a budget and being vocal about it with your friends is the new trend among those looking to get their finances in order.</p>



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<p><em>News You Should Know is a digest of news from publications around the nation about finance, investing, and retirement.</em></p>


News You Should Know: Medicare Begins Drug Price Negotiations


<p>The PERA Board of Trustees met on Friday, Nov. 17 for its final regular meeting of 2023.</p>



<p>Below are highlights of some of the major topics of discussion and important actions the Board took during the meeting.</p>



<h4 class="wp-block-heading"><strong>2024 Board election</strong></h4>



<p>The Board approved the calendar for the <a href="https://www.copera.org/four-seats-on-pera-board-up-for-election-in-2024" target="_blank" rel="noreferrer noopener" class="broken_link">2024 Board election</a>, during which four seats will be up for election: Two in the State Division, one in the School Division, and one in the Denver Public Schools Division.</p>



<p>Candidacy information will be available to members of those divisions in early January, and the election will take place in May.</p>



<h4 class="wp-block-heading"><strong>Member contribution interest rate</strong></h4>



<p>Every PERA Defined Benefit Plan account accrues interest, compounded annually. If a PERA member leaves PERA-covered employment and requests a refund of their account, they receive their contributions, the interest earned on that balance, and any applicable employer match. If that member keeps their account with PERA, the balance will continue to accrue interest and the member has multiple options upon reaching retirement eligibility, including choosing a lifetime monthly benefit.</p>



<p>The Board is responsible for setting the interest rate every year; it currently stands at 3 percent. The Board’s policy, <a href="https://content.copera.org/recap-of-the-pera-boards-november-2022-meeting-2/" target="_blank" rel="noreferrer noopener">updated in 2020</a>, evaluates the interest rate as a component of members’ overall retirement benefit. After discussing the issue, Trustees voted to keep the interest rate at 3 percent for 2024.</p>



<h4 class="wp-block-heading"><strong>Asset/liability study update</strong></h4>



<p>In September, the Board kicked off an important analysis of PERA’s investment portfolio and asset allocation strategy known as an asset/liability study. The project will help the Board determine if it needs to make any changes to PERA’s mix of investments. PERA’s strategic asset allocation is the primary driver of investment returns, and the Board adopted its current allocation following the last asset/liability study in 2019.</p>



<p>The Board’s investment consultant, Aon, said in the meeting that it continues to work with PERA’s investment staff to gather and analyze information. That process will continue over the next few months, with additional discussion in January.</p>



<blockquote class="wp-block-quote">
<p><strong>READ MORE:</strong> <a href="https://peraontheissues.com/asset-liability-study-a-guide-to-building-a-strategic-portfolio/" target="_blank" rel="noreferrer noopener">Asset/Liability Study: A Guide to Building a Strategic Portfolio</a></p>
</blockquote>



<h4 class="wp-block-heading"><strong>PERA-related legislation</strong></h4>



<p>With the 2024 General Assembly around the corner, the Trustees discussed the upcoming session and potential PERA-related legislation. The conversation included two bills that lawmakers on the Pension Review Commission expect to introduce: One that aims to expand the number of PERA retirees who can work for school districts without reductions in their benefits, and one that proposes a $700 tax credit for qualifying retirees in tax years 2024 and 2025.</p>



<blockquote class="wp-block-quote">
<p><strong>READ MORE:</strong> <a href="https://peraontheissues.com/pension-review-commission-eyes-two-bills-for-2024-legislative-session/" target="_blank" rel="noreferrer noopener">Pension Review Commission Eyes Two Bills for 2024 Legislative Session</a></p>
</blockquote>



<p>The Board’s first meeting of 2024 will take place on Jan. 19.</p>


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