This week, TRS launched its annual “Value Brochure,” highlighting the worth that TRS has dropped at each its members and to the Texas financial system over the previous fiscal yr.
Whereas TRS has had an more and more optimistic impression on the Texas financial system as a complete, TRS members who’ve retired since 2004 have by no means acquired a cost-of-living adjustment (COLA) to their TRS annuities. Many retirees nonetheless obtain the identical month-to-month annuity now that they did over a decade in the past, with no adjustment for inflation. Greater than a decade of inflation has severely shrunk the buying energy of these retired educators. Based on the Bureau of Labor Statistics, the U.S. greenback at the moment is price solely about two-thirds of what it was price in 2004.
TRS introduced that common TRS month-to-month life annuity for FY 2022 was $2,174, up lower than $30 from final yr’s common.
As a result of newer retirees usually have increased month-to-month annuities than their counterparts who retired in earlier years, the common month-to-month annuity goes up annually. Nevertheless, a person retiree’s month-to-month annuity is about for all times as soon as they retire except the Legislature takes motion to cross a COLA, so the common improve in annuity has no impact on a person retiree’s expertise.
Figures included within the brochure confirmed that TRS was a strong drive in stimulating the Texas financial system. TRS estimates that 94% of all TRS pension funds had been spent domestically in Texas, the next determine than most different states.
When combining the financial impression of pension funds and well being care funds made by the system, TRS estimates that final yr, it was chargeable for including $23.9 billion to the state’s complete gross home product (GDP), a determine generally used to measure the well being of economies. TRS estimates that the system’s pension and well being care funds created 268,183 jobs in Texas final yr, and the TRS funding fund has $9.5 billion price of holdings invested in Texas-based companies.
Regardless of the financial advantages that the TRS pension system creates, the Texas Legislature has not invested in TRS members. TRS serves over 1.9 million complete members. Based on knowledge from the U.S. Census, one out of each 20 Texans is a TRS member. TRS’ numbers recommend that if these retirees had been to be given extra shopping for energy via routine changes to their pensions, the impact on the Texas financial system can be staggering.