Retirement

The amount of retirement income will be determined by using the value of the contributions to your credit at retirement towards the purchase of an annuity and/or L.I.F. (Life Income Fund).

The pension payable under this plan is in addition to any benefits payable under the Canada/Quebec Pension Plan and Old Age Security.

Retirement Date
Your normal retirement date will be the first day of the month coincident with or immediately following the date you attain the age of 65. Early retirement may be taken at any time during the ten year period preceding your normal retirement date. Alternatively, you may elect to defer the commencement of your retirement benefits and may do so but not any later than the day preceding your 69th birthday.

Funds Required for Retirement
When the contribution level for this plan of 10% was set up it was based on the assumption that this level of contribution, when combined with government benefits, would provide approximately 70% of pre retirement income after 30 to 35 years of participation. Specific circumstances will actually determine the level of retirement income you require.

The following chart has been developed to assist in retirement planning. By cross referencing your age and current salary the table indicates the percentage of pretax income that needs to be set aside annually in either the Fellowship Pension Plan and/or your own RRSP's to achieve a retirement income of 70% of your pre retirement income.

If, in reviewing the table, you find that you are contributing significantly less than shown, you may not have sufficient funds to provide adequate retirement income to maintain an acceptable life-style during retirement. You should then review your retirement needs and increase savings or contributions to your RRSP or Fellowship Pension Plan.

Earnings> $20,000 $25,000 $30,000 $35,000 $40,000 $45,000 $50,000
Age
20 5 5 6 7 7 7 7
25 5 6 7 8 8 8 8
30 6 7 8 9 9 10 10
35 7 8 9 11 11 12 12
40 9 20 11 13 14 15 15
45 11 13 14 16 18 19 20
50 15 17 19 22 24 26 27
55 23 26 29 33 37 39 42
60 45 53 59 65 73 79 85

The shaded area indicates that the amounts of pretax income that would have to be set aside are greater than allowed under the Income Tax Act for tax-sheltered savings.


* Included in the 70% is the benefit which would be available from the Canada/Quebec Pension Plans and the Old Age Security Pension, assuming that you were eligible for the maximum amounts provided by these plans. If a portion of your income is made up of housing allowance, which is not subject to C/QPP deductions, it is possible that you will not be eligible for maximum benefits under the C/QPP plan.

Future cost of living increases in salary are factored into the above table; however, promotional increases could not be included. Our salary surveys indicate that the salary of experienced pastors with 20 or more years' experience was nearly 50% larger than for pastors with less than 5 years experience.

There are many factors which contribute to this difference; however, you should bear in mind that your salary could increase more than is assumed in the above example. It would be wise to look at salary ranges one or two columns to the right of where yours currently is in the table, to ensure that you are setting aside sufficient funds for retirement.

The example assumes a married male who has not yet begun to save for retirement, and who selects a non indexed pension with a 60% survivorship benefit for his wife.