The majority of United Methodist pastors serving our churches are on the United Methodist pension plan. I’m so thankful for churches that faithfully pay into their pastor’s retirement even thought they may not fully understand what exactly they are paying for. I’m hoping to shed some light on the subject with this post and video.
In the Dakotas UMC, churches with a pastor on the pension plan pay for all four of the following benefits. Pastors in other conference may not necessarily receive the last one. By the way, I’m not going to bother explaining the acronyms because I don’t know most of them, AND the pension plan will be changing from CRSP to Compass soon.
- CRSP-DB: This is is usually about 50% the bill and pays for the years of service part of the retirement. Every year your pastor serves a church, they are promised an additional amount in retirement that will be paid to them as long as they live…kind of like social security.
- CRSP-DC: This is about 15% of the bill and is put into a retirement savings account with the pastor’s name on it. This is kind of like a 401k. The pastor gets the benefit of market gains.
- CPP: This is also about 15% of the bill. This is actually the pastors death or disability insurance. I’m not sure why it’s been lumped in with the retirement. If your pastor or a member of their immediate family dies, the family gets a lump sum of up to $50k. If your pastor becomes disabled, which does happen unfortunately, they receive disability income.
- UMPIP: This is about 20% of the bill. This is the church’s contribution to the pastor’s personal retirement savings (similar to an IRA). The pastors almost all make their own personal contributions into this account through a salary withholding.
The above only touches on what the plans are about. For a better description, I linked to Leana Stune’s training videos for new clergy. Leana is our Conference Benefits Officer and does a great job explaining in detail.
- Leana’s video on UMPIP: https://vimeo.com/483806159
- Leana’s video on CRSP: https://vimeo.com/483111803
- Leana’s video on CPP: https://vimeo.com/477678716
- Wespath Pension Info: https://www.wespath.org/retirement-investments/retirement-plans
- Wespath Death/Disability Info: https://www.wespath.org/health-well-being/benefit-programs/comprehensive-protection-plan
- Description of Compass (future retirement plan): https://www.wespath.org/assets/1/7/5447.pdf
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