
<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://www.asppa-net.org/news/maine-colorado-enter-partnership-offering-automatic-retirement-coverage" target="_blank" rel="noreferrer noopener"><strong>Maine, Colorado Enter Partnership in Offering Automatic Retirement Coverage | ASPPA</strong></a></h4>



<p>Colorado’s state-run retirement plan for private-sector workers whose employers don’t offer one, called Colorado Secure Savings, is joining forces with Maine’s state-run plan. Under the partnership, the two plans will operate separately but the same vendor will serve as administrator for both.</p>



<h4 class="wp-block-heading"><a href="https://www.fiercehealthcare.com/payers/huge-decline-spending-medicare-begs-question-why" target="_blank" rel="noreferrer noopener"><strong>Huge Decline in Spending on Medicare Begs the Question: Why? | Fierce Healthcare</strong></a></h4>



<p>For years, federal spending on Medicare had been on a steep upward climb, but recent data show spending per beneficiary has been more or less flat for the past decade. While the reasons for the change in spending aren’t entirely clear, experts say it could be a combination of various factors, including policy changes and better health in older populations.</p>



<h4 class="wp-block-heading"><a href="https://www.reuters.com/markets/us/us-household-net-worth-hits-record-2nd-qtr-fed-says-2023-09-08/" target="_blank" rel="noreferrer noopener"><strong>Stock Market Drives U.S. Households to Record Wealth | Reuters</strong></a></h4>



<p>While recent headlines have highlighted decreases in Americans’ savings account balances and increases in debt, it’s not all bad news. According to the latest Federal Reserve data, overall household wealth (net worth) reached a new high in the second quarter, driven largely by the stock market and real estate.</p>



<h4 class="wp-block-heading"><a href="https://www.kiplinger.com/retirement/overlooked-benefits-of-estate-planning" target="_blank" rel="noreferrer noopener"><strong>Three Overlooked Benefits of Estate Planning | Kiplinger</strong></a></h4>



<p>Many people put off estate planning until later in life — and some don’t even think about it before it’s too late. But it’s an important task that can have many valuable benefits, including some while you’re still around.</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: Colorado Teaming With Maine on State-Run Retirement Plan


<h4 class="wp-block-heading"><a href="https://abcnews.go.com/Business/stock-market-soared-year-experts-weigh/story?id=101522862" target="_blank" rel="noreferrer noopener"><strong>The Stock Market Has Soared This Year, But Will It Last? Experts Weigh In | ABC News</strong></a></h4>



<p>While some experts have been predicting a recession in the U.S. for months, the stock market continues to show significant gains, prompting debate about whether current trends will continue. Here’s what multiple experts say about the state of the economy and what may be in store for the months ahead.</p>



<h4 class="wp-block-heading"><a href="https://www.reuters.com/business/finance/fed-set-launch-long-awaited-instant-payments-service-modernizing-system-2023-07-20/" target="_blank" rel="noreferrer noopener"><strong>Fed Launches Long-Awaited Instant Payments Service, Modernizing System | Reuters</strong></a></h4>



<p>The Federal Reserve launched a new system that aims to speed up and modernize money transfers in the United States. The system, called FedNow, will allow for instant transfers any time of day, eliminating the current days-long lag period when sending money. The service is launching with several dozen banks and service providers, with more expected to sign up.</p>



<h4 class="wp-block-heading"><a href="https://www.biopharmadive.com/news/moderna-merck-cancer-vaccine-phase-3-start/689010/" target="_blank" rel="noreferrer noopener"><strong>Moderna, Merck Advance Cancer Vaccine Into Late-Stage Test | BioPharma Dive</strong></a></h4>



<p>Moderna and Merck are moving to the next phase of testing a promising new vaccine for cancer. The experimental mRNA vaccine can be personalized to a patient’s cancer, and researchers will be testing whether it’s effective in people who have had tumors removed and are at high risk of the cancer returning.</p>



<h4 class="wp-block-heading"><a href="https://www.kiplinger.com/retirement/how-to-navigate-may-december-marriages-at-retirement-time" target="_blank" rel="noreferrer noopener"><strong>How to Navigate May-</strong></a><strong><a href="https://www.kiplinger.com/retirement/how-to-navigate-may-december-marriages-at-retirement-time" target="_blank" rel="noreferrer noopener">D</a></strong><a href="https://www.kiplinger.com/retirement/how-to-navigate-may-december-marriages-at-retirement-time"><strong>ecember Marriages at Retirement Time | Kiplinger</strong></a></h4>



<p>If you’re in a relationship with someone who is significantly older or younger, you may find yourselves in a tricky situation when the older partner reaches retirement age. Here are some things to consider and tips for navigating conflict when one partner enters another stage of life before the other.</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: Will the Stock Market Continue Its Upward Climb?


<p>The year has gotten off to a rocky start in the stock market, as concerns about the economy, inflation, and the Russia-Ukraine conflict have led to a series of ups and downs in the major stock indexes.</p>



<p>PERA’s investment staff, led by Chief Investment Officer Amy C. McGarrity, manages a portfolio of more than $60 billion (as of Sept. 30, 2021) on behalf of PERA members and retirees. While staff monitor market activity and trends, PERA’s investment focus is on the long-term.</p>



<p>McGarrity recently participated in a discussion with other CIOs at the Council of Institutional Investors’ spring conference, where she and the other panelists spoke about the challenges of investing in today’s market environment and the importance of a strategic, diversified portfolio.</p>



<p>“We are in the business of providing retirement security, so we invest strategically,” McGarrity said. “We don’t try to predict what the markets will do from day-to-day, but instead we remain invested in our primary asset classes throughout the market cycle, with a focus on long-term returns.”</p>



<h4 class="wp-block-heading"><strong>Strategic asset allocation</strong></h4>



<div class="wp-block-image"><figure class="alignright size-medium"><a href=""><img decoding="async" src="" alt="Pie chart showing PERA's preliminary, unaudited asset allocation as of Sept. 30, 2021: 58.8% global equity, 19.5% fixed income, 8.7% private equity, 7.8% real estate, 4.7% alternatives, 0.5% cash" class="wp-image-4939"/></a><figcaption>PERA&#8217;s preliminary, unaudited asset allocation as of Sept. 30, 2021 (click to enlarge)</figcaption></figure></div>



<p>The PERA Board of Trustees sets PERA’s <a href="https://www.copera.org/investments" target="_blank" rel="noreferrer noopener">strategic asset allocation</a>, which dictates how the fund’s portfolio should be split between various types of investments like stocks, bonds, and real estate. Those investments carry different levels of risk (potential for loss in value) and potential return (gain in value). For example, stocks can generate strong returns but often come with a higher level of risk, while bonds typically generate lower returns but also have a lower level of risk.</p>



<p>The result is a diverse mix of investments with varying levels of risk that can help protect the overall portfolio during times of market volatility.</p>



<p>While the stock market may go up or down in a given year, PERA’s strategic asset allocation was developed with the goal of ensuring PERA’s investments will generate value over the course of several decades, regardless of what happens in any one year.</p>



<h4 class="wp-block-heading"><strong>Focusing on the long-term</strong></h4>



<p>Being invested for the long-term means being exposed to the ups and downs of market cycles. Downturns are expected, and the swiftness with which they can occur often overshadows the rise in markets, even though positive market environments typically outweigh the negative impact of historical downturns.</p>



<p>For example, in early 2020, global equity markets saw steep losses as COVID-19 spread around the world. By the end of the year, the markets had rebounded and even posted gains.</p>



<p>PERA’s assumed rate of return — one of the key numbers PERA uses to forecast how much money the fund will have on hand to pay benefits in the future — is 7.25 percent. While the actual return in a given year may be higher or lower than 7.25 percent, the goal is to meet the assumed rate of return over a period of 30 or more years. PERA’s annualized return over the past 10 years is 9.4 percent. By maintaining a well-diversified portfolio of assets and a focus on long-term returns, PERA is well-positioned to weather ups and downs in the markets and continue providing lifelong monthly benefits to current and future retirees.</p>


Staying the Course: PERA’s Approach to Market Volatility


<h4 class="wp-block-heading" id="medicare-to-consider-lowering-part-b-premiums-kiplinger"><strong><a href="https://www.kiplinger.com/retirement/medicare/604056/medicare-to-consider-lowering-part-b-premiums" target="_blank" rel="noreferrer noopener">Medicare to Consider Lowering Part B Premiums</a> | Kiplinger</strong></h4>



<p>Late last year, Medicare announced monthly premiums for Part B (medical coverage) would increase due to FDA approval of a controversial and expensive Alzheimer’s drug. The drug’s manufacturer has since cut the price in half, leading Medicare to reconsider its premium hike.</p>



<h4 class="wp-block-heading" id="colorado-lawmakers-know-where-they-want-to-direct-federal-covid-funding-they-just-have-to-figure-out-how-the-colorado-sun"><strong><a href="https://coloradosun.com/2022/01/31/colorado-arpa-committee-reports/" target="_blank" rel="noreferrer noopener">Colorado Lawmakers Know Where They Want to Direct Federal COVID Funding. They Just Have to Figure Out How.</a> | The Colorado Sun</strong></h4>



<p>For months, three task forces of Colorado lawmakers have been discussing how best to spend $2.6 billion in COVID funds from the federal government. The legislature has until the end of 2024 to allocate the money, and the task forces recommend focusing on priorities like affordable housing, behavioral health and economic relief.</p>



<h4 class="wp-block-heading" id="interest-rates-are-expected-to-rise-in-2022-here-are-4-ways-to-prepare-cnbc"><strong><a href="https://www.cnbc.com/2022/01/24/interest-rates-are-expected-to-rise-in-2022here-are-4-ways-to-prepare.html" target="_blank" rel="noreferrer noopener">Interest Rates Are Expected to Rise in 2022 — Here are 4 Ways to Prepare</a> | CNBC</strong></h4>



<p>The Federal Reserve is expected to raise a key interest rate — the federal funds rate — this year. Changes in that rate can lead to changes in other interest rates, like those you pay on credit cards, mortgages and other loans. Here are some smart money moves to consider while the federal rate is still low.</p>



<h4 class="wp-block-heading" id="don-t-let-the-volatile-stock-market-rattle-your-retirement-savings-plan-yahoo-finance"><strong><a href="https://finance.yahoo.com/m/c54a1e38-ba4b-4af9-b7d2-e252ffd6b8a1/don%27t-let-the-volatile-stock.html" target="_blank" rel="noreferrer noopener">Don’t Let the Volatile Stock Market Rattle Your Retirement Savings Plan</a> | Yahoo! Finance</strong></h4>



<p>The stock market has seen some wild ups and downs lately, which may cause some anxiety for people who have money invested in stocks. Nobody likes to see their account balance drop when the market dips, but good investment strategy and an eye on the long-term can help provide peace of mind during times of volatility.</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>


Tag Archives:

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

News You Should Know: Colorado Teaming With Maine on State-Run Retirement Plan

News You Should Know: Will the Stock Market Continue Its Upward Climb?

Staying the Course: PERA’s Approach to Market Volatility

News You Should Know: Medicare May Lower Part B Premiums

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