STRS FUNDING PERIOD

From Mario Iacone, August 2, 2009

After all the discussion on what effects the Funding Period, are we missing,

THE MOST SIGNIFICANT IMPACT ON THE FUNDING PERIOD?

INVESTMENT LOSSES!

STRS was more than meeting the THIRTY YEAR FUNDING PERIOD from 1999 through 2001.

Investment Losses in 2002 destroyed the 30 Year Funding Period.

STRS was more than meeting the THIRTY YEAR FUNDING PERIOD (26.1 years) in 2007.

Investment Losses in late 2008 once again destroyed the 30 Year Funding Period.

EXAMINE THE CHARTS BELOW!

It is obvious that an effective Risk Management Program needs to be implemented.

Note that the Funding Period Chart obtained on the STRS website does not show the Actual Asset Value, but shows the Actuarial Value of Assets.

Click images to enlarge.