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403(b)(9) Church Plan
Presented: January 20, 2012
© 2012 Envoy Financial, Inc. All rights reserved.Envoy Financial, 8415 Explorer Drive, Suite 115, Colorado Springs, CO 80920
Securities offered through Envoy Securities, LLC, Broker Dealer, Member FINRA/SIPC. Advisory Services offered through Envoy Advisory, Inc., Registered Investment Advisor.
First Use: January 20, 2012
403(b)(9) Church Plan
Presented: January 20, 2012
© 2012 Envoy Financial, Inc. All rights reserved.Envoy Financial, 8415 Explorer Drive, Suite 115, Colorado Springs, CO 80920
Securities offered through Envoy Securities, LLC, Broker Dealer, Member FINRA/SIPC. Advisory Services offered through Envoy Advisory, Inc., Registered Investment Advisor.
First Use: January 20, 2012
Bruce H. BruinsmaEnvoy FinancialCEO & Co-FounderDirect: 719.268.2711, ext. 203Cell: 626.399.2247Email: [email protected]
What is retirement? ◦ That depends on your perspective.◦ Retirement years are also “ministry” years.
At Envoy, we see retirement as “not only a reward for past service, but astepping-stone to future ministry”
Future-Funded Ministry: ◦ Managing God’s resources God’s way so His purposes can
be carried out in and through our lives, to the very end.
“It is vanity to wish to live long...and then not to live it impacting others.
A life well spent”
A National Plan: Reduces costs, simplifies administration
A 403(b)(9) Church Plan: Maintains key benefits 10% required church contribution for all Ministers
and Designated Executives All churches, Presbyteries, and National office a part
of the plan: An Opt Out Option for Churches
National Office:◦ Legal ◦ Investment menu◦ Administrative
oversight
Local Church:◦ Who Participates◦ How much is
contributed (10% for ministers)◦ When do the church
contributions start◦ [Universal eligibility
on a voluntary basis]
A plan for those with ministerial status and named executives is required:◦ 10% minimum contribution◦ Additional options such as an additional matching component
are possible
Staff may participate on a voluntary basis immediately beginning with employment
A plan for staff composed of a basic contribution, matching contribution, or both is available and up to each church to decide
Housing Allowance: Distributions taken by those with ministerial status can be tax-protected
A Roth Provision: After-tax contribution and tax-free growth
Loan Provision Default Investment: Where the money goes if the
participant does not select one Automatic Enrollment: Starts the contribution even
if the eligible participant has not enrolled
*Subject to Qualification Rules
Traditional 403(b) Roth 403(b)
Pre-Tax Contributions
Tax-Deferred Savings
Taxable Withdrawals
Taxed Contributions
Tax-Free Earnings*
Tax-Free Withdrawals*
The Retirement Plan Oversight committee:
Minimum of 5 members:◦ Minister with investment
knowledge◦ Minister with no retirement
plan expertise◦ Investment specialist◦ Communication specialist◦ COO of the ECO◦ Additional member as
needed
Support for the Plan will come from:
Envoy TPA and Recordkeeping
Envoy Advisory Envoy Financial◦ Legal and Compliance ◦ Recordkeeping and
reporting◦ Investment Counsel◦ Education and Information
Delivery services, education, and information will come to you throughthe Envoy Web Portal
Our SmartPlan Interactive guide helps Participants determine their risk profile, select investments, complete account reviews, and more!
Provides clear, concise, easy to understand information:◦ Plan information◦ Keys to understanding◦ Enrollment : Risk Profile, $ goals, Investment allocation
suggestion◦ Periodic reviews◦ All administrative activities: Loans, Distributions,
Contributions, and Investment changes
How does this impact me?Will I have enough?
Ministers:◦ Your PCUSA defined benefit plan will
remain and be distributed according to its formula and age availability◦ All future contributions will go into
the ECO 403(b)(9) Church plan◦ All current 403(b)(9) account values may be transferred to
the new ECO Plan◦ Transfers from other plans and eligible IRA’s to the ECO
Plan are allowed
Non-Ministerial Staff:◦ All current PCUSA 403(b)(9) account values are eligible for transfer to
the ECO 403(b)(9) Plan◦ All future voluntary, and if
available, church basic or matching contributions will be made to the ECO 403(b)(9) Plan
◦ Transfers from other plans and eligible IRA’s to the ECO plan are allowed
Effective Salary $40,000.00 $56,000.00 $60,000.00
Median salary 2010 $52,900.00 $52,900.00 $52,900.00
Salary used for calculation $52,200.00 $56,000.00 $60,000.00
Annual pension creditaccrual
$661.00 $700.00 $750.00
Pension credits for a 30-yearcareer
$19,830.00 $21,000.00 $22,500.00
Monthly pension for life $1,652.50 $1,750.00 $1,875.00
Survivor’s monthly pension for life
$826.25 $875.00 $937.50
Key Assumptions:◦ Age◦ Current income◦ Life expectancy◦ Salary growth (1.5%)◦ Contribution to retirement
($ amount) (10%)◦ Rate of return (6%)◦ Distribution factor (7.3%)
Current Defined Benefit Plan+
Current Defined Contribution Plan+
ECO 403(b)(9) Plan=
Estimated Income
Current PCUSA Defined Benefit $ 2,800 Estimated Defined Contribution $ 1,500 Estimated ECO 403(b)(9) $ 2,012
Total Monthly Inc. Estimate $ 6,312 Annual Estimated Income $ 75,744
◦ Assumes: Age 50, $70,000, retires at 67
Current PCUSA Defined Benefit $ 3500 Estimated Defined Contribution $ 1500 Estimated ECO 403(b)(9) $ 564
Total Monthly Inc. Estimate $ 5064 Annual Estimated Income $ 60,768
◦ Assumes: Age 60, $100,000, retires at 67
I’m still working on numbers and format
ALERT!
One of the Goals for the ECO plan is total transparency regarding costs and fees. New regulations will require that all fees and costs be disclosed by all vendors later in 2012.
In the industry, costs of 403(b) and 401(k) plans have often not been disclosed. The disclosure will be paired with the services being provided. There will not be just a “total” number. If you are involved in other retirement plans, these disclosures will be coming later this year... don’t be surprised.
Initial:◦ $5 Recordkeeping setup per participant◦ $5 Advisory setup per participant
Ongoing:◦ $75 per year administrative
Participant: ◦ Advisory: $5 annually, collected monthly◦ Administrative: $35 annually, collected monthly◦ Recordkeeping: .0025 annually, collected monthly
Advisory: Based on All Assets in the Plan◦ $1,000,000 .58% annual rate .0542% monthly◦ $2,000,000 .48% annual rate .0400% monthly◦ $4,000,000 .39% annual rate .0325% monthly
Church decides whether to opt out or not?◦ If “opt out”, then Church Board to sign required paperwork
If in, then decide the answers to:◦ Who, When, and How much
Complete the Member Sponsor paperwork:◦ This will be available “online” so look for information◦ Select a Member Sponsor Plan
Administrator for your church◦ Follow the instructions as provided
Website:◦ Envoyfinancial.com◦ ECO Retirement plan website (available soon)
Question and Answer:◦ Available online or email
Envoy Financial ECO representative (contact information available soon)
National Office ECO representative (contact information available soon)
A National Plan: Nat. Ofc. Presbyteries, Churches A 403(b)(9) Church Plan, defined contribution 10% to ministers and designated executives A church may opt out, but have adequate substitute Legal, Investments and Administration: National
Office Plan design and qualifications, local church Support: Envoy Advisory, Envoy TPA and
Recordkeeping, Envoy Financial
Services provided by:
Envoy TPA and Recordkeeping, Inc. Third Party Administration Envoy TPA and Recordkeeping, Inc. Recordkeeping Services Envoy Advisory, Inc. Registered Investment Advisor Envoy Securities, LLC Broker/Dealer Member FINRA/SIPC Envoy Financial, Inc. Education, Sales and Marketing
Bruce H. BruinsmaDirect: 719.268.2711, ext. 203Cell: 626.399.2247Email: [email protected]: www.EnvoyFinancial.com
403(b)(9) Church Plan
Presented: January 20, 2012
© 2012 Envoy Financial, Inc. All rights reserved.Envoy Financial, 8415 Explorer Drive, Suite 115, Colorado Springs, CO 80920
Securities offered through Envoy Securities, LLC, Broker Dealer, Member FINRA/SIPC. Advisory Services offered through Envoy Advisory, Inc., Registered Investment Advisor.
First Use: January 20, 2012
