denominational retirement plan · the retirement plan oversight committee: minimum of 5 members:...
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Denominational Retirement Plan
Presented: Orlando:
February 1, 2013© 2013 Envoy Financial, Inc. All rights reserved.
Envoy Financial, 4194 Royal Pine Drive, 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: August 20, 2012
Bruce H. BruinsmaEnvoy FinancialCEO & Co-FounderDirect: 719.268.2711, ext. 203Cell:
626.399.2247
Email:
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 a
stepping-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 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 either 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
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
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
$ 3,500
Estimated Defined Contribution
$ 1,500
Estimated ECO 403(b)(9)
$ 564
Total Monthly Inc. Estimate
$ 5,064
Annual Estimated Income
$ 60,768
◦
Assumes: Age 60, $100,000, retires at 67
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: $.0065 annually,
collected monthly
◦
Administrative:
$35 annually,
collected monthly◦
Recordkeeping:
.0025 annually,
collected monthly
Advisory:◦
$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
Question and Answer:◦
Available online or email
Envoy Financial ECO representative [email protected]
A National Plan: Nat’l Office, 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:
626.399.2247
Email:
www.EnvoyFinancial.com
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
Denominational Retirement Plan
Presented: Orlando:
February 1, 2013© 2013 Envoy Financial, Inc. All rights reserved.
Envoy Financial, 4194 Royal Pine Drive, 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: August 20, 2012