According to PERS, the new retirement plans allow members to have the current percentages of employee salary and employer contributions deposited into an individual defined contribution account and invested as directed by the member.
Under the current defined benefit plan, PERS investment professionals direct the investment of employee and employer contributions.
The move mirrors one underway for some months now for
Florida state workers. However, Nebraska has recently
moved in a different direction – moving from a defined
contribution arrangement to a cash balance program.
PERS said that as of January 1, 2003:
- about 200,000 current members as well as 200,000 inactive members, all with less than five years of service as public employees, are eligible to select one of the new retirement plans
- all new public employees hired after that date will be eligible to select one of the new retirement plans.
Based on member surveys and focus groups, PERS estimates that approximately 30,000 current employees will select one of the new plans.
The Public Employees Retirement System of Ohio provides benefits to 620,000 members, has assets of around $50 billion and is the tenth largest public pension fund in the United States.