THE CHURCH RETIREMENT PLAN

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Presentation transcript:

THE CHURCH RETIREMENT PLAN 403(b)(9) Retirement Plan for Southern Baptist Churches The Church Retirement Plan is a plan designed exclusively for Southern Baptists by GuideStone Financial Resources as part of its commitment to serve those who serve the Lord by assisting in financial preparation for future retirement. Doug Roberts, CFP® Relationship Manager Associate

The Church Retirement Plan GuideStone Financial Resources® serving since 1918 403(b)(9) Retirement Plan for Southern Baptist Churches — The Church Retirement Plan Building on a legacy of service that began in 1918, GuideStone Financial Resources continues to provide products and services that address the financial needs of those employed by Southern Baptist organizations. This includes a retirement plan tailored to your needs: The 403(b)(9) Retirement Plan for Southern Baptist Churches, also known as the Church Retirement Plan.

The Church Retirement Plan What is it? 403(b) — tax code designation for nonprofit organizations Similar to: 401(k) — for-profit businesses The Church Retirement Plan is identified by the tax code designation 403(b) given to retirement plans for non-profit organizations. This plan is similar to 401(k) plans that are used by employees of for-profit businesses.

The Church Retirement Plan Who can participate? Anyone with taxable income from a Southern Baptist church, church-related school or association Ministers or non-ministerial staff Full-time, part-time or bi- vocational The Church Retirement Plan is identified by the tax code designation 403(b) given to retirement plans for non-profit organizations. This plan is similar to 401(k) plans that are used by employees of for-profit businesses.

Why use it? No sales commissions 100% of your contributions are invested into your account With thousands of investment options available for ministers and church employees, why should they use this plan? First, the Church Retirement Plan has no sales commissions. This means 100% of the money you contribute is invested directly into your account.

Why use it? No sales commissions Reduction of taxes Employee contributions: Deferral of income taxes Exclusion from Social Security taxes for ministers This plan may also help you reduce your taxes. Income taxes are deferred on plan contributions and investment earnings, and contributions by ministers are also excluded from Social Security taxes.

Why use it? No sales commissions Reduction of taxes Higher contribution limits than IRA Participants who are serious about maximizing tax savings possibilities will like the fact that tax-sheltered contribution limits are much higher in this 403(b) plan than with an IRA. In fact, in the Church Retirement Plan you may be able to shelter up to 100% of your taxable income under certain conditions!

Why use it? No sales commissions Reduction of taxes Higher contribution limits than IRA Income may be designated as housing allowance for ministers in retirement Distributed tax-free An additional advantage is available to ministers in retirement as they may be able to request their income to be designated as a housing allowance. All such amounts used within legal limits to provide a home are distributed tax free.

Why use it? No sales commissions Reduction of taxes Higher contribution limits than IRA Income may be designated as housing allowance for ministers in retirement Added benefits and contributions for eligible participants Disability and life protection benefits Matching retirement contributions The Church Retirement Plan doesn’t just help you save taxes while you invest for tomorrow, it also provides valuable features that can help protect you and your family today. If you are eligible, these features include disability and life protection benefits and matching retirement contributions. They will be discussed in detail in a moment.

Why use it? No sales commissions Reduction of taxes Higher contribution limits than IRA Income may be designated as housing allowance for ministers in retirement Added benefits and contributions for eligible participants Christian-screened investment options Proven investment management firms Through the Church Retirement Plan you have access to Christian-screened investment options that do not invest in companies that are publicly recognized as providing products or services in the liquor, tobacco, gambling, pornography or abortion industries. GuideStone uses proven investment management firms to manage these plan investment options.

Contribution Sources Employer Recommended goal: 10% of employee’s monthly income Employee Salary reduction Rollover Other retirement plans or IRA Baptist state convention Matching retirement contribution As previously mentioned, a third type of contribution is provided to eligible participants by Baptist state conventions in the form of a matching retirement contribution.

What kinds of contributions can be made to your account? Participant contributions Tax-sheltered Tax advantages Reduction of taxable income in year of contribution Deferred taxation of contributions and earnings Additional tax advantages for ministers Contributions exempt from SECA Housing allowance designation Roth elective deferrals Tax-sheltered contributions offer tax advantages both now and at retirement. The immediate benefit to plan participants is a reduction in taxable income in the year of the contribution. Less taxable income almost always translates to lower tax liability for the current year. Deferred taxation of contributions and earnings allows for potentially quicker growth through compounding — as no taxes are due until the funds are distributed. And many participants find themselves in a lower tax bracket in retirement when the distributions are taxed. Participant contributions by persons who are Ministers for Tax Purposes have two added advantages. First, these contributions are also exempt from Social Security, or SECA taxes. Secondly, distributions to a retired minister from this plan can be designated as a “housing allowance,” providing a significant tax savings opportunity in retirement.

State Convention Contributions Disability Income Benefit Up to $500 a month disability income In addition to insurance or Social Security Contributes to retirement account $35 each month of disability benefit The disability benefit provides up to $500 a month in disability income to an eligible plan participant who becomes disabled. This benefit is paid in addition to any disability insurance or Social Security benefits. Every month this disability benefit is paid, a $35 contribution is also made into the retirement account of the disabled participant.

State Convention Contributions Disability Income Benefit Survivor Protection Benefit Amount paid to beneficiaries determined by participant’s age at death Can equal as much as $100,000 Paid in addition to participant’s retirement account balance The survivor benefit is similar to life insurance. If an eligible participant dies while active in the plan, his or her beneficiaries receive a survivor benefit. The amount is determined by the participant’s age at death but can equal as much as $100,000. This benefit is paid to survivors in addition to the participant’s retirement account balance.

State Convention Contributions $105.00 $1 for $3 matching retirement contributions (maximum $17.50) Your monthly contribution level $52.50 For every $3 contributed each month in excess of $52.50, $1 in matching convention contributions is provided to eligible participants, up to a maximum monthly convention contribution of $17.50. To receive this maximum amount, eligible participants must have employer and/or participant contributions equal to at least $105 per month. Protection benefits — Disability Income Benefit and Survivor Protection Benefit $1.00

Investment Fund Selection One-choice approach GuideStone Funds MyDestination Funds® Asset allocation approach GuideStone Funds Asset Allocation Funds Build-your-own approach GuideStone Funds Select Funds GuideStone Financial Resources Capital Preservation Fund We are committed to providing our participants with the best possible options for choosing their investments. As a result, GuideStone’s emphasis on investment choice will be “approach,” rather than “product oriented.” The three options for investment assistance will be: (CLICK TO REVEAL EACH STEP IN THE BUILD) “One-choice” approach — use of the age appropriate MyDestination Funds®  as the single fund solution. “Asset allocation” approach — utilize GuideStone Funds Asset Allocation Funds. “Build-your-own” approach — utilize fund literature to create and maintain your unique mix of GuideStone’s Select Funds. (NOTE: Capital Preservation Fund for SBC participants only)

First, is the one-choice approach or “Do it for me” First, is the one-choice approach or “Do it for me”. Lots of people like this because it utilizes the “set it and forget it” mentality. In the investment industry these are known as at target-date mutual funds. Our brand name for them is the MyDestination Funds. They way they work is simple. First, select the fund that contains the year in the name that is closest to the year when you will retire or will begin drawing funds for retirement. That would be the fund for you. It is comprised of a pre-blended mix of our stock and bond mutual funds. As you see graphically depicted across the top of the page, the allocation starts off more aggressive, and is automatically moderated over time, so that as you approach the target date, the allocation approaches a moderate 50% stock/50% bond allocation. Then, this dynamic moderating of the allocation continues for 12 years past the target date. As you see, you start off more aggressively, when you’re further out from retirement, the allocation moderates as you approach retirement, and then goes from moderate to conservative as you enter and go through retirement. All this happens behind the scenes, without you having to ask.

The next approach is the asset allocation approach The next approach is the asset allocation approach. It looks similar to the target-date approach, but with one significant difference. Under this approach, the funds are a pre-blended mix of our stock and bond mutual funds. However, the allocation remains static – there is no dynamic moderating over time like the target-date approach. If someone wanted to start and remain aggressive, they might consider the Aggressive Allocation Fund. Alternatively, if someone wanted to start and remain moderate, they might consider the Balanced Allocation Fund. But keep in mind that these investments need periodic review. You invest differently in your 30’s than you do in your 60’s.

Last, is the Build-Your-Own approach Last, is the Build-Your-Own approach. These are our Select Funds (both stock and bond funds) that you may use to create your own customized allocation. There are good for those of you who like to research and have the expertise or you already have someone that assists you with your allocation, you may want to build your own portfolio allocation utilizing the Select Funds. Keep in mind when choosing your funds to not pick based on 1 year returns. You want to look at the fund history as a whole. Be diversified and do your research! Our select fund lineup is comprehensive but we do not have multiple funds per asset class.

The MyDestination Funds attempt to achieve their objectives by investing in the GuideStone Select Funds. These funds are managed to a retirement date (“target date”) by adjusting the percentage of fixed-income securities and equity securities to become more conservative each year until reaching the retirement year and then approximately 12 years thereafter. The target date in the name of the Funds is the approximate date when an investor plans to start withdrawing money. By investing in the Funds, you will also incur the expenses and risks of the underlying Select Funds. The principal risks of the Funds will change depending on the asset mix of the Select Funds in which they invest. You may directly invest in the Select Funds. The Funds’ value will go up and down in response to changes in the share prices of the investments that they own. There is no guarantee that the Funds’ principal value will increase, including at the targeted date. It is possible to lose money by investing in the Funds. The Asset Allocation Funds attempt to achieve their objectives by investing in the GuideStone Select Funds. By investing in these Funds, you will also incur the expenses and risks of the underlying Select Funds. The principal risks of the Funds will change depending on the asset mix of the Select Funds in which they invest. You may directly invest in the Select Funds. The Funds’ value will go up and down in response to changes in the share prices of the investments that they own. It is possible to lose money by investing in the Funds.

Important Information Characteristics and Performance You should carefully consider the investment objectives, risks, charges and expenses of the GuideStone Funds before investing. A prospectus with this and other information about the Funds may be obtained by calling 1-888-GS-FUNDS (1-888-473-8637) or downloading one at GuideStoneFunds.com. It should be read carefully before investing. GuideStone Funds are made available through GuideStone Financial Services, member FINRA. Shares of GuideStone Funds are distributed by Foreside Funds Distributors LLC. (MANDATORY SLIDE – CANNOT BE HIDDEN.)

Getting Started: How do you manage your retirement account? Customer Solutions Center Monday through Friday, 7 a.m. to 6 p.m. CST Call 1-888-98-GUIDE (1-888-984-8433) Email (info@GuideStone.org) Our highly trained customer service specialists are also available to personally help you manage your retirement account by answering your questions and assisting you with all retirement account transactions.

To access MyGuideStone, simply visit www. GuideStone To access MyGuideStone, simply visit www.GuideStone.org and just click on the Account Login button.

Next, enter your user ID and password to begin managing your plans online. If you do not have an user ID, simply select the “Register Now” button to create your user ID and password.

Getting Started in the Church Retirement Plan Church Retirement Plan application Rollover application Information kit Online at GuideStone.org Call 1-888-98-GUIDE (1-888-984-8433) Monday through Friday, 7 a.m. to 6 p.m. CST Getting started in the church retirement plan is really quite simple. First, you need to complete a plan application. Second, if you already have money in another 401(k) plan, 403(b) plan or a Traditional IRA, you can roll it into the Church Retirement Plan by completing a rollover application. Consolidation can simplify your investment life. All of these forms are included in an information kit that can be ordered online at GuideStone.org or by calling the toll-free number. GuideStone customer service representatives are available every business day from 7 a.m. to 6 p.m. CST to answer your questions or assist you with completing any or all of the required forms.