What is a Target Date Fund and how does it work? Check out this award-winning video that explains how Target Date Funds make retirement investing easier.

Reducing Investment Risk as You Age

The Individual Account Program, the account-based benefit of PERS, was converted to a Target Date Fund format at the beginning of 2018. This conversion reflects an investment best practice and will better protect older workers from potential losses as they approach and enter retirement.

IAP Target Date Fund Profile

Quarterly performance information for Target Date Funds 

(Note: These fact sheets reflect investment performance of the Target Date Funds. IAP account returns are credited by PERS once annually on a calendar year-end basis, in the subsequent April. Earnings credited to member accounts by PERS are different than the amount earned by investments. This is due to PERS administrative expenses and reserving requirements provided in statutes, administrative rules, and PERS Board actions.)

Which Target Date Fund am I In?

PERS-covered workers receive an annual IAP account deposit equal to 6 percent of salary. Before 2018, all IAP accounts had exactly the same investment risk, independent of participants’ unique age and retirement horizon profiles. This uniform approach was not consistent with fiduciary standards and investment best practices.

The new Target Date Fund structure gradually reduces investment risk as participants age.

This “glidepath” methodology is embedded in each, separate Target Date Fund. Younger workers take on more investment risk in exchange for higher, long-term growth potential. Decades later, this approach protects those very same workers from adverse market volatility as they approach and enter retirement.

Your specific fund is based on your birth year. See the chart below:

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“Invested for You" is an Oregon Investor Update from the Oregon State Treasury. This newsletter is a twice-yearly publication to help promote better understanding about Oregon public trust funds and the Individual Account Program, and is written specifically for Oregon Public Employees Retirement Fund (OPERF) beneficiaries.

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Starting in 2021, You Can Choose a Different IAP Target-Date Fund

The 2019 Legislature passed SB 1049, which will allow IAP participants to revise their own investment approach by choosing a different target-date fund. Currently, your IAP target-date fund is automatically chosen based on your birth year.

By fall 2020, PERS will inform members of an “optional investment choice window,” in which you can choose a Target-Date Fund for your IAP investments, different from the default option based on your birth year.

Beginning in 2021, you may choose to invest your IAP balance in a target date fund that is more reflective of your own risk tolerance than the default based on your age.

From the IAP’s inception in 2004 through 2017, individual account program balances were invested the same way, for every person, at every age. In 2017, the Oregon Investment Council approved creation of IAP Target-Date Funds to more closely align age and risk exposure. The Target-Date Funds became effective in 2018.

To learn more about IAP member choice and the other changes approved by the Legislature in SB 1049, you can visit a web page from the Oregon Public Employees Retirement System at https://www.oregon.gov/pers/MEM/Pages/SB1049.aspx

In addition, you can sign up for updates to be emailed to you: Sign up to receive alerts from the PERS agency about SB 1049.

I Have Questions About my IAP Account

Visit www.oregon.gov/pers to learn more about your retirement benefits. You may also view your IAP account through iap.voya.com. Questions about retirement benefits may be directed to PERS Member Services at 888-320-7377 or via email at PERS.Member.Services@state.or.us. Representatives are available Monday–Friday 8:30 a.m. to 5:00 p.m. (Pacific Time).

I Have Questions About Treasury or IAP Investments

Please contact Treasury about the investment structure of the IAP and related matters at IAP.comments@ost.state.or.us. Please note that Treasury does not have individual member account data.