“Each year, Teachers' Retirement System distributes approximately
$7 billion in benefits to retired members and beneficiaries. Those benefits
must be – and always have been – paid each month, no matter what the economic
conditions may be.
“TRS will continue to have sufficient funds to meet all benefit
payments on time and in full for the foreseeable future despite the worldwide
economic downturn created by the spread of the coronavirus.
“The
System's defensive investment strategy enabled TRS to protect the bulk of
member assets during recent market upheavals. On December 31, 2019, TRS assets stood at $54.24 billion. As
of April 20, 2020, the investment
portfolio was valued at $50.18 billion.
“‘The
impact of the economy's hard stop is being felt in every household, every
business, every school and every government in the United States. TRS is not
immune,’ said TRS Executive Director Dick Ingram. ‘TRS was able to limit
the economic damage from the coronavirus because our investment strategy
emphasizes keeping risk at a minimum.’
“A key
element of the TRS investment program is to maintain a focus on steady,
long-term investment returns. Short-term corrections in the investment
markets get the headlines, but TRS recognizes that the majority of its
members maintain relationships with the System that last for several decades.
“For
instance, the 40-year return for TRS at the end of 2019 was 9.1 percent.
During the same period, the annualized return for the S&P 500 index was
8.4 percent.
“In its 81-year history, TRS has survived
numerous economy-shattering events, including World War II and the resulting
reconstruction of Europe and Asia, wars in Korea and Vietnam, oil supply
crises in 1973 and 1979; runaway inflation in the 1970s and 1980s; numerous
stock market "corrections;" the Iranian invasion of Kuwait, the
terrorist attacks of September 11,
2001 and five global health epidemics – SARS, Ebola, the Avian Flu, the Zika
virus and the Swine Flu.
“‘Our long-term perspective and strategy serve our members well,’ Ingram added.”
Sincerely,
Member
Services Department
Teachers' Retirement System of the State of
Illinois
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