If you have a Tax-Deferred Annuity account with the Teachers’ Retirement System, you have money invested in the Fixed Return Fund and/or in one or more of TRS’ five variable return Passport Funds. The value of these variable return funds fluctuates according to investment performance.

The basics

TRS members who invest in the variable return Passport Funds purchase “units” with their contributions. Units are like shares in a mutual fund. Similarly, when members reallocate investments from one of the funds, units are “sold” or “redeemed” based on the unit value at that time. Unit values [see table at right] are the dollar value of the units in each of the funds. The unit values are based on each portfolio’s closing market value at the end of the preceding month.

As the unit values fluctuate from month to month, your fund account balances also vary. Here’s an example: You invest $100 in March when the unit value is $25, and you purchase four units. In April, the unit value is $26. Those four units are now worth $104. Keep in mind that additional contributions, loans and other account activity would also affect the number of units and your account balances.

Calculating monthly unit values

For each of the variable return Passport Funds, TRS calculates the monthly unit value according to the following formula:

• TRS multiplies the preceding month’s unit value by the monthly net change in the value of the fund’s portfolio; and
• TRS discounts the amount by .3274 percent to offset the 4 percent annual increase in the number of units that participants receive. (This calculation is in accordance with the New York State administrative code.)

In general, if you withdraw money from your account, the unit value used to determine your account balance would be the unit value in effect for the month after TRS receives your withdrawal request.

TRS Passport Funds

TRS’ six Passport Funds are available to all Tax-Deferred Annuity Program participants. TRS publishes investment results twice each year in the TRS In-Service News. For more details about the Passport Funds, please review the TRS Fund Profiles booklet.

Learn the current unit values

• Current unit values are one click away on the TRS website at www.trsnyc.org. Past unit values are also available on the TRS website.
• Current unit values are also available on the TRS phone system. Call 888-8NYC-TRS and follow the prompts.
• New unit values are usually posted on the TRS website in the third week of each month. Follow TRS on Facebook or Twitter to receive notice.
• A three-month summary of the unit values is published in each edition of the New York Teacher.
• The Fixed Rate of Return Fund is TRS’ one investment choice that does not have monthly unit values. Investments in the Fixed Rate of Return Fund are credited with a set rate of return in accordance with state law.

Board of Education Retirement System

Some UFT members are eligible for the BERS TDA Program, which offers its participants a choice of two investment options: the Fixed Return Program and the Diversity Equity Fund. For more information about these funds, visit BERS’ website at www.nycbers.org.

Look before you invest

Before you invest in any of these funds, here’s some advice: Never invest in anything you do not understand. TRS carefully selects and monitors all the funds. While the Fixed Income Return guarantees a rate of return, the other funds do not. And remember that past performance does not predict future performance. Be sure to make choices based on your investment philosophy and your tolerance for investment risk and volatility.