November 2007 Dividend Payments

What is the November dividend?
The Iowa Legislature created the November dividend to help offset the negative impact that inflation has on pensions. IPERS pays the dividend only once during the year with the normal November benefit payment.

Who is eligible for the November dividend?
IPERS members who retired before July 1, 1990, are eligible for the November dividend.

Will I get a separate November dividend payment?
No. The dividend is added to your regular November benefit payment.  

How long will I continue to receive the November dividend?
You will receive the November dividend for the rest of your life. Iowa law guarantees it.

How is each person’s dividend calculated?
IPERS uses a formula from the law to figure the amount. The formula includes a base payment and a percentage multiplier used to figure any increase. The base payment is guaranteed but increases to the base payment are not.

Why didn’t my dividend payment increase?
The law does not permit an increase in the November dividend amount if the current contribution rate is less than the contribution rate that the actuary annually determines is necessary to cover the projected cost of promised benefits. The legislature, not the actuary, currently sets the contribution rate paid by employees and their employers. Although the legislature recently increased this rate, it is still less than the rate needed to cover the projected cost of promised benefits. The actuary calculates this rate each fiscal year.

Will the dividend ever increase?
The dividend cannot increase until contribution rates reach the right level. The actuary will recalculate the actuarial rate next year and reexamine if IPERS can adjust next year’s dividend.

Is my November dividend payment at risk if IPERS’ investment returns are lower than expected?
No. The dividend you receive each November is guaranteed for your lifetime. It will never be reduced or stopped.