System’s Assets and Funding

The assets of the Hampshire County Retirement System are accumulated from three primary funding sources: member contributions, employer appropriations and investment returns.

Member contributions are the mandatory contributions that you make to the retirement system as a percentage of your salary deducted from your paycheck. Although individual contribution rates vary based on your individual membership date. As of July 1, 1996 new members contribute at the rate of 9% of salary plus an additional 2% of salary in excess of $30,000. Member contributions are maintained in individual annuity savings accounts. The system pays annual interest at a pass-book savings rate set by statute to the annuity savings accounts.

Employers' contributions are annual appropriations based on an actuarial funding schedule which includes both normal employee costs and unfunded liabilities. Employers’ contributions are maintained in the aggregate in the pension and pension reserve funds. Employers' contributions are not attributed to individual members.

Investment Earnings are the third major source of income that make up the assets of the system. Investment earnings are maintained in the aggregate in the pension reserve fund.

Member contributions and employer appropriations and investment earnings are combined and invested together in various domestic and international investment vehicles including Cash, Fixed Income, Equities, Real Estate and Alternative Investments to generate investment earnings.