The supplemental retirement programs under the Virginia Retirement System (VRS) provide additional retirement benefits to Virginia’s state and local government employees, managing approximately $8 billion in assets. Administered as part of the Virginia Retirement System (VRS), these programs offer defined contribution and hybrid plan structures that complement the state’s primary defined benefit pension.
Investment Strategy
The supplemental retirement programs under the Virginia Retirement System maintain a diversified investment portfolio designed to provide long-term capital appreciation and income for participants. The fund allocates across domestic and international equities, fixed income, real estate, and alternative investments. Asset allocation decisions are guided by actuarial assumptions and capital market forecasts, with periodic reviews to ensure alignment with participant needs and market conditions. The programs leverage the broader investment infrastructure and expertise of the Virginia Retirement System’s investment team, benefiting from the scale and institutional knowledge of one of the larger state retirement operations in the country.
Private Markets Approach
The programs’ alternatives allocation, representing approximately 10% of total assets, includes commitments to private equity and real estate strategies. In private equity, the fund participates through partnerships with established general partners focusing on buyout, growth equity, and credit strategies. The real estate program includes investments in commingled funds spanning core and value-add strategies, providing diversification and inflation-hedging characteristics. Given the supplemental programs’ comparatively smaller scale, their private markets approach is more concentrated than those of larger state pensions, with a focus on established managers and proven strategies. The programs benefit from the investment team’s relationships and due diligence capabilities developed through the larger VRS platform.
Frequently Asked Questions
What is the Virginia Supplemental Retirement System?
The supplemental retirement programs under the Virginia Retirement System (VRS) provide supplemental retirement benefits to Virginia's state and local government employees. They manage approximately $8 billion in assets through defined contribution and hybrid plan structures.
How does the Virginia Supplemental Retirement System invest?
The programs invest across a diversified portfolio of equities, fixed income, real estate, and alternative assets. Approximately 10% of assets are allocated to alternatives including private equity and real estate funds.
What is the relationship between the Supplemental System and the Virginia Retirement System?
The supplemental retirement programs operate under the Virginia Retirement System (VRS). While VRS manages the primary defined benefit pension, the supplemental programs provide additional retirement savings options for eligible state and local employees.
