The recently released 2018 Economic Impact Report from Missouri LAGERS shows the pension fund paid $308 million to retired local government workers and their loved ones last year with ninety-three cents of every dollar ($286 million) staying in Missouri.
But LAGERS pensions may have an even larger economic impact. According to the National Institute on Retirement Security, each $1 in state and local pension benefits paid to Missouri residents ultimately supported $1.41 in total economic output. This figure attempts to measure the direct, indirect and induced impacts of retiree spending as it ripples through the Missouri economy. Taking this into account, LAGERS' retirees created total economic output of $403 million within Missouri last year!
The economic impact proves that LAGERS is not only good for those receiving benefits, but for Missouri as a whole. Pensions allow local governments in Missouri to attract and retain quality workers that provide valuable services to taxpayers across the state. The workers' benefits grow with the number of years of public service they devote to their community. And, since most retirees remain living in the communities they served while working, pension checks go right back into the economy as retirees purchase local goods and services.
For over 50 years, LAGERS has helped middle class workers transition into middle class retirees. Benefits provided through LAGERS are modest, but stable and reliable. The average annual LAGERS pension payment is $11,940. For a retiree with 26-30 years of public service the average annual pension from LAGERS is $29,916. These benefits are hardly considered lucrative, but do provide a stable base on which to build financial independence. Plus, 65% of the benefits are paid for by the returns generated from LAGERS' investments.
One out of every ten Missouri residents is a beneficiary of LAGERS. With over 34,000 active local government workers and almost 30,000 former workers covered by LAGERS, we have a very important responsibility to ensure we maintain a financial stable fund to encourage a secure retirement for all. LAGERS continues to steadily climb toward 100% funding status (currently around 96%) and sees about 15 new local governments join each year.
LAGERS participants have peace of mind knowing they will receive what they have earned. But the presence of LAGERS provides benefits that extend beyond our membership to the taxpayers and local government employers in Missouri.