Business & Real Estate
By Adam Ashton
February 1, 2017 – 5:50 PM
The fund that manages pensions for California teachers on Wednesday voted to lower its investment forecast by half a percentage point, a decision that will have many educators stepping up their payroll contributions for their retirement plans by several hundred dollars a year.
The board of the $196 billion California State Teachers’ Retirement System chose to phase in the lower investment forecast, ratcheting it down from today’s 7.5 percent to 7.25 percent for its current financial plans. It’ll drop to 7 percent next year.
The decision follows a similar move by CalPERS last month that gradually drops its investment forecast from 7.5 percent to 7 percent.
Both decisions acknowledge that the funds have earned lower-than-expected returns in recent years. With less money from investments, the funds are turning to taxpayers and employees to shore up their finances.
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