The ripple effect

How effective retirement plan design can change a life

By Stephen Osborne

From the first day on the job until the last paycheck, church staff members look to their key decision-makers for guidance and direction. They trust you to make decisions that are in the best interest of the church, as well as their well-being as church employees.

And that is a biblical responsibility for you as a church leader. Scripture reminds us in Proverbs 27:23 to “Be sure you know the condition of your flocks, give careful attention to your herds.”

But what about after they move on in their ministry? Can you still care for them?

Surprisingly, yes.


As a church leader, you play a vital role in retirement plan decisions that will ripple through the lives of your staff — for better or worse.

Use these four action steps to help determine if you — and your church’s employees — are on the right track.

#1: Identify plan goals and objectives

The first step in achieving your goals is deciding what they should be. Churches who offer successful retirement plans typically focus on helping their staff save well so they can retire at an appropriate age with financial security.

An example of a good, measurable target goal would be the
90/15/90 rule:

Aim for 90% employee participation

Divide the number of actively contributing employees by the total number of eligible staff members to find out your current participation percentage.

Work toward a 15% minimum contribution between the church and the employee

Create an employer matching scenario that encourages your staff to contribute more toward this goal.

Strive for 90% of employees to invest in an appropriate asset mix

Run reports with your retirement plan provider to see if your staff is investing prudently.

#2: Engage church staff members through plan design and automatic features

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Once you’ve identified your goals for the retirement plan, consider implementing these best practices to increase staff engagement and participation:

Automatic enrollment is a plan feature that can be implemented churchwide. It enrolls all existing and new staff members in your retirement plan with a predetermined, employee deferral — usually around 5% to 6% of the staff member’s salary — and often an employer contribution, as well. Once employees are automatically enrolled in a retirement savings plan, very few decide to opt out.

Employer contributions are another common incentive that offers a built-in motivation to keep your church staff on track to a timely retirement. For example, the church provides a basic 5% non-matching contribution for all staff and 5% matching contribution for any staff member who contributes their own salary deferral. If a staff member takes full advantage of the retirement plan, the employee would reach an optimal savings target of 15%.

#3: Focus on driving staff participation

Regularly promoting retirement awareness and providing educational materials to church employees is key to enhancing their use of the plan and allowing them to develop a savings strategy of their own. However, some of your staff members might struggle with deciding to participate at all because they feel that retirement planning shows a lack of faith.

As a church leader, it is important for you to remind them that preparing for retirement doesn’t mean a definite end to the calling the Lord has placed on their life, but rather it awards them the freedom to be financially prepared for whatever He might have planned for the next phase of their ministry.

#4: Track progress and success

Education and comprehension are critical for your staff members to reach desired retirement outcomes and for the church to effectively manage its retirement plan. In order to see plan development and growth, it is important to track your progress annually to ensure the optimal health of your retirement plan. You can do this by:

• Promoting awareness of plan design features that encourage your staff to take full advantage of each benefit

• Measuring contribution trends annually to monitor staff engagement

• Conducting annual retirement plan reviews to evaluate progress and direct educational focus for the new year

These four action steps can help you and your church staff members reap the full benefits of your retirement plan, because your futures both depend on it.


Stephen Osborne is the senior relationship manager of GuideStone Retirement Relationship Management (www.GuideStone.org), where he has served those who serve the Lord since 2005. Bringing together performance + values, GuideStone® offers a full suite of retirement services to churches, universities, seminaries, hospitals and other ministry organizations.

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