I’ve always paid attention to the matter of retirement and retirement income. When GuideStone or the state convention sent a guy around to speak to the pastor’s conference or to an associational meeting, I was present and paying attention. When I reached the age (I think it was 55) where I received an invitation to our state convention’s pre-retirement conference, I registered and attended. In fact, I did so several times before I pulled the trigger and actually retired.
There is no shortage of advice floating around about retirement. GuideStone has tips, calculators, and counsel about retirement. Some of the standard advice includes starting to save early, investing wisely, planning ahead, paying attention to your retirement accounts, making the right payout choices, not drawing on your retirement funds for occasional needs, and many others. They are all good.
But the single, best piece of advice I ever received came from a GuideStone rep, I don’t recall his name, who spoke to some gathering of ministers. Maybe it was an associational meeting or a pastor’s conference. I don’t remember but here’s his advice:
No one is going to take care of you when you retire. You had better take care of yourself.
Really? That profound, huh? Look at it this way:
1. The government is not going to take care of you. There will be something in Social Security but it will not be enough. Ask around in your church about Social Security benefits and see how far your members think they go towards living expenses in retirement and old age. Chances are, the buying power of Social Security retirement benefits (the average check is around $1,300 per month) is almost certain to decrease. You better take care of yourself and count Social Security as a bonus check, not the main thing.
2. Your church isn’t going to take care of you. They will take up a retirement offering, give a nice gift, smile and bid you farewell. What none of your churches will do is keep you on the payroll, even if you find yourself in dire straits. A wise pastor will convey to his present church his need for building a retirement fund. Ask for a retirement budget item. Let the church be billed monthly for this and pay it. My very first pastorate never heard of such. After serving for a year, I asked for it. They budgeted a modest amount, continued it year-after-year, as did my subsequent pastorates. I saw to it that church leaders understood that the amounts could not stay flat but should increase. Sometimes they increased, sometimes not. When the money wasn’t there for an increase, I managed to divert a little salary to retirement. This should be standard. Once you’re gone, your wonderful church members will not be too worried about you. You better take care of this while you can.
3. Your family isn’t going to take care of you. We Baby Boomers are benefiting from the highest gold price we’ve ever had, and the transfer of trillions (twelve zeros brethren) from our Depression/WWII parents. It is uncertain if we Boomers will have great sums to pass along to our kids. I’ve told mine what my father told me and my siblings: “Make your own plans. Your mother and I are planning to have it come out where we spend it all before we die.” Count on this at your own risk. Remember the big mortgage meltdown, the dot com bubble, and all the others? Wealth can be wiped out in a hurry.
4. God isn’t going to take care of you. Well, of course He is. But you would be highly unwise and irresponsible to presume that He will reward your financial indolence by adding a zero or two to your checks. You save now out of what He has blessed you with.
5. Some anonymous benefactor isn’t going to step in and make you a wealthy retiree. It would be almost obscene for relatively wealthy American clergy (average SBC senior pastor salary…around $60k) to have a sense of entitlement at retirement. Really? You think God is going to stuff your mailbox with checks or flood your bank account with EFTs when billions live for a year on less than you make in a month? Why should God move someone to throw money at you?
6. Chances are, your church is not going to deed the parsonage to you. Make a plan. Save some money. Buy a house and rent it. Don’t count on someone giving you a house. Better take care of this yourself.
And, sure, I know there are challenges. Most SBC clergy will start and stay in average-sized or smaller congregations because that’s where most SBC churches fall. Pay is modest unless you move up in church size but all of us cannot be in above average size and budget churches. Many churches do still have parsonages. Many clergy start saving late, accumulate student debt, or spend savings on their education and thereby lose important years where savings can be compounded. I doubt you will have a creditor who will think any of these excuses are sufficient to waive your debts and bills.
The cold, hard reality is that you need to take care of your retirement yourself (include your wife, of course). No one else has as much at stake as you do. It can be done. I encourage you to give serious thought to doing it. Try and do more than you think you can. It’s doable. No one else is going to do it.
I could have supplemented my retirement fund if I had ten bucks for every time I was asked about my “Southern Baptist retirement plan.” Some church members even had the idea that the SBC had some sort of retirement system for clergy. No such thing, of course.
Excellent article William.
Many thanks, Jared.
William,
We had been on the mission field about 12 years when the IMB started talking about a 3 legged stool (social security, Annuity Board and ??) Then the IMB entered into an agreement with American Express financial advisers who helped us manage our money in such a way that, while not living in the “Lap of Luxury,” we are comfortable. I watched missionaries from other agencies struggle financially while our IMB took good care of us.
Joseph Patrick…aka Gerry Milligan
I know it’s not true in most families that your kids will look after you. There’s some of it in both my family and my wife’s family. So my in-laws live in our basement and we’ll keep them there as long as we can. My folks live across town by themselves and it’s possible that one of my brothers will pick up their care. I don’t expect them to and I have a decent retirement account, but my kids have already talked about which one of them gets to take care of us. I remind them that they might have… Read more »
It’s impossible to see 30-40 years down the road, Jim. Family is more important in this but my assumption is that if one makes adequate plans for his own family, any inheritance will be a bonus. The math is such on government assistance that Social Security benefits will likely be means tested and that the COLA will be adjusted downward. The former doesn’t mean much to the average pastor but the latter does. That and future government policy of allowing the dollar to degrade will harm those who overly rely on Social Security in retirement. I don’t see euthanasia but… Read more »
I’m not talking about inheritance. In my neck of the woods, the old agrarian lifestyle was strong in caring for your parents and grandparents. There are vestiges of this still around. It was once expected that investing in your kids was investing in your older years because they would take care of you. I’m not talking about Social Security with regard to the economy. I’m talking about the economy in general. What’s important is not how many dollars you have saved up but what those dollars can do for you. If inflation outstrips interest and commodities necessary for survival rise… Read more »
This is excellent advice. I have personally dealt with retired pastors who basically had nothing. They opted out of Social Security, and their churches did not pay into Guidestone for them. Their children did not care for them. Thus, they were left penniless. I was able to secure some Guidestone relief funds for them, but this is only a small amount. I asked the church to help them, and a one-time love offering was taken. Don’t let this happen to you.