WHAT ARE YOUR MONTHLY CONTRIBUTIONS TO THE FUND?
Every month, you and your employer pay a contribution into the Fund. These contributions are as follows:
- Your monthly contribution = 9% of your pensionable salary (Councillors pay 7.5%). However, if your conditions of employment provides for it, you can decide on a contribution rate of either 7.5% or 9% of pensionable salary.
- Your employer’s monthly contribution = 18% of your pensionable salary (Local Authorities pay either 7.5% or 10% of Councillors pensionable salaries). All the costs and premiums for the optional risk benefits that you choose are deducted from the employer's contribution.
You are permitted to make extra voluntary payments (i.e. additional voluntary contributions) towards the growth of your member share. Speak to your payroll department to arrange this.
Many employers permit their staff to structure their own cost to company package or to calculate their retirement contributions based on a salary that is less than their cost to the company. The Fund regards the salary on which the contributions are calculated as your pensionable salary. All your insured risk benefits will be based on this pensionable salary. If your pensionable salary is 80% of your cost to company, it means that you are saving 27% (i.e. your contribution and your employer’s contribution) of 80% of your monthly total cost to company. You are not saving 27% of your total cost to company.
With its large pool of pensioners, and solid governance practices, this reliable fund has a proud history of strong investment returns that has consistently outperformed its peers.
As a local government employee or councillor, the Fund recognises your right to choose your own risk benefits, at affordable rates. Many funds force you to choose your risk benefits from a list of predefined risk benefits which they call categories. With this approach you must choose a category that best matches your personal needs even if it means that you pay for benefits you don’t want. Like it or not, you end up subsidising the insured premium for other members. With us, you are in control as you choose only what you want, and the rest of your contribution is invested in your member savings account for retirement.
Just as all vehicle manufacturers are not the same, all funds are not the same. Even though many vehicles offer similar features the design and engineering of those features are not equal. The most important features in any vehicle are those pertaining to safety and the protection of the occupants of the vehicle. That is what you get when you join the LA Retirement Fund. You get a Fund where the Board of Trustees actively concerns itself with protecting the wealth it has generated for members. For most members, their retirement savings from their fund forms the bulk of their retirement provision.
Your Member Share Account
The LA Retirement Fund is a defined contribution Fund, which means that you contribute monthly to the Fund and build-up your own personal savings account within the Fund, which is like a bank account. Your contribution will be deducted from your salary automatically before you get paid each month.
We refer to your personal savings account in the Fund as your member share. Your member share is made up of your contributions plus your employer contributions plus monthly investment returns, minus the cost of your selected insured risk benefits and the general running cost of the Fund.
Your member share grows steadily over the course of your working life, and, when you retire, you have the option to invest it further in the Fund and receive a monthly annuity.
Since it is important to try and grow your biggest retirement nest egg as much as possible before you retire, reliable and competitive investment returns are especially important. And that is exactly what the LA Retirement Fund gives you.
Your contributions are transferred monthly to the Fund’s asset managers, consequently your member share, grows steadily over time so that you can invest it when you retire and get a monthly pension to provide you with an income for your old age.
You may view your member share account on-line or via the Fund’s App click here to register for the free service.
