California Teachers’ Pension Weighs Lower Assumed Rate of Return
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The California State Teachers Retirement System, the second-largest U.S. public pension, will consider cutting its expected earnings rate on investments to 7.5 percent, increasing the need for higher contributions as it recovers from market losses.
The $132 billion pension fund’s governing board will consider approving a new rate of return, now 8 percent, at its Nov. 5 meeting in Sacramento, according to its agenda. The so-called assumed rate of return on investments is used to calculate the size of pension contributions from employers needed to pay retirees.