Funding

The LAPP Fund holds the Plan assets, which contains what we've committed to pay all LAPP members in the future throughout their entire retirement. Out of the fund, we also pay the monthly pensions guaranteed to all current retiree members. The fund is a combination of the contributions that have been paid by employers and employees (members) and the investment returns earned on the money in the fund.

The money we owe, often called our liabilities or pension obligation, is the estimated amount of money we need to pay pensions today and 70+ years into the future. The pension obligation is estimated because we have no way of knowing for sure how long each member in the Plan will live, when they will retire and how long they or their partner will collect a pension after retiring. LAPP's pension obligation is calculated by using mathematical estimations called actuarial assumptions that predict life expectancies for members and their pension partners.

We also have no way of knowing how much money the fund will earn in investments or whether our membership will grow, and by how much or for how long. Moreover, we do not know what salary our members will earn over the coming decades or what interest rates and inflation rates will be.

But what we do know, for sure, is that we have to put money aside today to pay for these pensions tomorrow. That means we need to estimate what all those factors will be so we can set a price today to cover the costs of tomorrow’s pensions.

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Learn how the LAPP pension fund is professionally managed to provide you with a secure retirement income.

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Try out the LAPP Pension Estimator and access printable forms, member newsletters, annual reports, investment information and more.

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Gain valuable information on how your pension will help support you in retirement.

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