How is the dividend rate determined?
The Chief Executive Officer asks the IPERS Benefits Advisory Committee for advice and then decides what the rate should be. By law, the highest the rate can be is 3 percent. The rate has been frozen at 1.07 percent since 2003 to extend the number of years IPERS can pay the dividend. This also treats retirees who receive the FED and those who receive a November dividend more equitably. Those who retired before July 1, 1990, have received no increase to their November dividend since 2001. Are future FED payments guaranteed? No. Unlike your monthly benefit payment, which is guaranteed for life, the FED is not guaranteed. IPERS can transfer more money from the Trust Fund to the reserve account only when IPERS is fully funded (assets cover the projected cost of future benefits) and will remain fully funded after a transfer. IPERS is not fully funded. Without transferring money to the reserve account, IPERS estimates it can pay dividends until 2013. This estimate assumes the account earns at
