Most active Nazarene ministers have 403(b) retirement accounts with Fidelity Investments, but many are not contributing to them, according to Don Walter, director of Pensions and Benefits USA.
In 2015, less than half of eligible ministers (49.8%) in the U.S. received an Annual Pension Supplement (APS) base deposit, and less than 41% actually contributed to their accounts, according to P&B USA figures. Additionally, more than 1,000 churches have never filed IRS-required “Participation Agreements.” This inaction prevents their ministers from being eligible for APS funds and from being able to contribute to their 403(b) accounts.
“This may be because their ministers have retirement plans at other places of employment,” Walter said. “That’s a good thing. But if they aren’t setting aside savings for retirement, we want them to know we have opened accounts for every eligible Nazarene minister with Fidelity Investments. All they have to do is visit the Fidelity webpage to create a Personal Identification Number (PIN), and have their church treasurer file the Participation Agreement and a Letter of Agreement with us regarding how much they want their church to either reduce their salary or add funds from the church’s budget to the account. After that, they can make contributions as they wish and take advantage of additional APS funds for which they are eligible.”
Contributions by pastors and their churches to these “Nazarene 403(b) Retirement Savings Plan” accounts allow ministers to enjoy tax advantages while saving for the future. Also, after retirement, funds may be withdrawn as housing allowance, providing further tax savings.
Pensions and Benefits USA joins with our partner, Fidelity Investments, to encourage ministers and church boards to do what they can to set aside more money for retirement via the Nazarene 403(b) Retirement Savings Account Plan. Fidelity provides many planning and calculation resources for Nazarene pastors who have registered their 403(b) accounts. Registration details and related information may be found at pbusa.org under the “Benefit Plans” tab.
“We encourage our ministers to use this special week as a time to consider the lifestyle they wish to have after they leave active ministry,” Walter said. “Even in small amounts, regular saving, over time, can make a big difference in whether retirement becomes a time to joyfully anticipate or something to dread.”