The Individual Account Program (IAP) is an account-based benefit for all Tier One/Tier Two and Oregon Public Service Retirement Plan (OPSRP) members who have worked in a qualifying position since January 1, 2004. Learn about the two parts to your future PERS retirement.
Until July 1, 2020, 6% of your salary was placed in your IAP account. If you currently earn more than $2,500 a month, less money is now going into your IAP due to Senate Bill (SB) 1049.
How much money is going into your IAP now depends on whether you are a Tier One/Tier Two or OPSRP member:
However, if you earn $2,500 or less per month, your contribution percentage has not changed.
You are automatically vested in your IAP account when your account is established.
Earnings or losses are credited annually to member accounts. Administrative fees are deducted from the fund's earnings as part of the annual crediting process. Your IAP is subject to earnings or losses until you remove the funds.
PERS works with employers to ensure that member contributions are accurate and complete before allocating earnings on a year-end balance basis so members are not adversely affected by posting delays or corrections.
Beginning in 2018, IAP accounts shifted from a one-size-fits-all investment format to customized IAP Target-Date Funds designed by the Oregon Investment Council for Oregon public employees. Learn more about the change and your options for choosing to invest in a different Target-Date Fund each September.
Since January 1, 2011, any retiring members must retire their pension (Tier One, Tier Two, or OPSRP) and IAP at the same time, as part of the retirement process.
However, members who only retired from their Tier One, Tier Two, or OPSRP pension prior to January 1, 2011, can retire from the IAP at any time.
Regardless of which of the above applies to you, there are several important factors to keep in mind when you apply for distribution of your IAP:
- IAP accounts are credited with investment earnings and losses based on your IAP Target-Date Fund and are subject to potential losses until you remove the funds.
- IAP accounts have no guaranteed rate of return.
Distribution options at and during retirement
You have the option to roll over your IAP balance into a traditional IRA, an eligible employer plan, a 457 deferred compensation plan, the Oregon Savings Growth Plan, or another qualified plan.
When you retire from the IAP, you can also elect to receive your IAP account balance as a lump-sum payment or in equal installments over 5, 10, 15, or 20 years, or over your expected lifetime. You can use the IAP Balance and Installment Calculator to
estimate your IAP distribution at retirement. Note: As of January 1, 2020, PERS retirees receiving installment payments or electing installment payments have their remaining IAP balance invested in the Retirement Installments Fund, which is based on the Oregon Short Term Fund. You can learn more about the Oregon Short Term Fund and the Oregon State Treasury's IAP investment strategy on Treasury's website.
You can find IAP retirement forms on the IAP forms page.
If a retired member dies before all installment payments are completed, the beneficiary is entitled to receive the remaining installment payments and may choose to receive the remaining amount in a lump-sum payment.
The Oregon Legislature created the IAP in 2003 to provide an individual account-based retirement benefit for new workers hired on or after August 29, 2003, and for Tier One/Tier Two members active on and after January 1, 2004. The IAP benefit is in addition to the member's pension benefit (Tier One, Tier Two, or OPSRP).
The IAP was established to receive member contributions on salary paid beginning January 1, 2004. All member contributions have been deposited in the IAP since that date.
If you are a Tier One or Tier Two member, you retained your existing Tier One or Tier Two regular and variable accounts, but as of January 1, 2004, no additional member contributions have been placed into those accounts. Instead, your member contribution is now placed in your IAP.
Go back to the IAP information page.