The New Hampshire Retirement System (NHRS, the retirement system) was established in 1967 as a contributory, defined benefit plan. The plan provides lifetime pension benefits, as well as disability and death benefits. It also provides a post-retirement Medical Subsidy benefit to eligible beneficiaries.
Benefit formulas and eligibility requirements are set by state law (RSA 100-A). The retirement system is also governed by administrative rules, policies adopted by the NHRS Board of Trustees, and the Internal Revenue Code.
NHRS has a very important role in the economic well-being of New Hampshire’s retired public employees, teachers, police officers, and firefighters. In the fiscal year ended June 30, 2023, NHRS had about 48,500 members and 43,600 benefit recipients; it paid out more than $950 million in pension and medical subsidy benefits.
Our mission is simple: “To provide secure retirement benefits and superior service.”
NHRS members are full-time state, county, and municipal employees, teachers, police officers, and firefighters. The membership consists of two groups: Group I (Employee & Teacher) and Group II (Police & Fire).
NHRS has more than 460 participating employers – the State of New Hampshire, counties, individual communities, school districts, and others. Not every New Hampshire political subdivision participates in the retirement system for its employees, although most do. Participation is mandatory for police, fire, and teacher employers.
NHRS paid out $971.1 million in pension benefits to 43,603 retirees and beneficiaries in fiscal year 2023. The average annual benefit is $22,218. In addition to pensions, the retirement system paid $41.9 million in post-retirement Medical Subsidy benefits. With nearly 80% of retirees and beneficiaries living in New Hampshire, these benefit payments have a significant positive impact on the state’s economy.
NHRS pursues an investment strategy designed to meet its long-term funding requirements. The Board of Trustees, with research and input from NHRS investment staff, outside experts, and a recommendation from the Independent Investment Committee, sets an investment policy that includes asset allocation and an assumed rate of return.
The Independent Investment Committee manages investments based on Board policies, continuously monitors and evaluates performance, and makes determinations regarding the hiring and retention of fund managers. The goal is to meet or exceed the retirement system’s assumed rate of return over the long term, while at the same time managing the risk, return, and liquidity of the portfolio.
Read more about investments
NHRS benefits are funded by member contributions, employer contributions, and net investment income. Investment returns historically provide the majority of funding for pension benefits.
The New Hampshire Constitution (Article 36-a) protects trust fund assets for the exclusive purpose of providing benefits; requires Trustees to set actuarially sound employer contribution rates; and requires employers to pay those rates in full.
The retirement system trust fund stood at $11.51 million as of June 30, 2023. On that date, NHRS was 67.2% funded and had an Unfunded Actuarial Accrued Liability (“unfunded liability”) of $5,609.5 million. The unfunded liability is the difference between the actuarial value of the retirement system’s assets and the actuarial value of benefits already accrued.
The NHRS unfunded liability results from several factors, including legislative decisions made in the 1990s, investment losses in the 2008-09 great financial crisis, and the adoption of more conservative actuarial assumptions in the past decade.
Having an unfunded liability does not mean that a pension plan is unable to pay the benefits for which it is presently obligated or to meet its cash flow requirements. Assets are available to pay present benefits and a statutory funding plan is in place to pay off the unfunded liability. Legislation enacted in 2018 requires the unfunded liability as of June 30, 2017, to be paid off through 2039. Biennial gains or losses from 2017 forward will be separately amortized over fixed periods of no longer than 20 years.
By statute, Group I (Employee & Teacher) members contribute 7% of their salaries to NHRS. Group II (Police & Fire) members contribute 11.55% and 11.80%, respectively. Group II members do not participate in Social Security.
While member rates are set by statute, employer rates are set by the Board every two years and are based on the results of biennial actuarial valuations.
Employer contributions are assessed at different rates for state employees, political subdivision employees, teachers, police, and fire.
Read more about employer contributions
For more than five decades, NHRS has played an important role in securing the economic well-being of New Hampshire’s retired public employees, teachers, police officers, and firefighters. The retirement system celebrated its 50th anniversary in 2017.
To mark this golden anniversary, we posted facts about the retirement system, photos of current and former members, and other related material in a special section