Revenues of the Plan are provided from three sources:
- Member contributions
- Employer contributions
- Investment income
Members contribute 8.5% of their salary, which is distributed towards the cost of their potential retirement benefit (6.5%), a benefit for their spouse (1.5%) and towards the costs of future increases (0.5%). If a member leaves the service of the City or Board of Education and is eligible to a refund, they will receive back their contributions plus interest (3% per annum). Member contributions normally make up 15 to 20% of total revenues over a year.
The employer contributes an amount that is dictated by the Illinois Pension Code. For MEABF, the employer is responsible for contributing 1.25 times the amount the member contributed two years prior. Employer contributions normally make up 15 to 20% of total revenues over a year.
Investment income is generated by the investment of the Plan’s reserves. The income is comprised of dividends on stocks, interest on bonds, and gains on the investment assets. Investment income normally makes up 60 to 70% of total revenues over a year. |
