PERAC Memo #7 - 2008: 2008 Interest Rate set at 0.6%

2008 Interest Rate set at 0.6%

Summary

PERAC Memorandum #7 (2008) sets the "regular interest" rate under G.L. c. 32, §22(6)(b) at 0.6% for calendar year 2008, based on average savings account rates from a sample of financial institutions. Boards must apply this 0.6% rate to accumulated total deductions and accrued interest when crediting interest for 2008 refunds and retirements, and also apply it on December 31, 2008 to outstanding balances as of December 31, 2007. No further action beyond applying this rate is required.

Full Text

MEMORANDUM #7, 2008 M E M O R A N D U M TO: All Retirement Boards FROM: Joseph.Connarton, Executive Director RE: 2008 Interest Rate set at 0.6% DATE: January 22, 2008 In accordance with the provisions of G.L. c. 32, § 22(6)(b) “regular interest” for regular and additional deductions made after January 1, 1984, shall be a rate established by the Public Employee Retirement Administration Commission in consultation with the Commissioner of Banks, and shall be obtained from the average rates paid on individual savings accounts by a representative sample of no less than 10 financial institutions. The average rate paid has been determined to be 0.6% for the calendar year 2008. The average rate of 0.6% is to be applied on the accumulated total deductions and accrued interest. Such interest shall be credited during the calendar year 2008 for refunds and retirements. Such interest shall also be credited on December 31, 2008 for outstanding balances as of December 31, 2007.