Comments for 20 Minutes with Robert Maggs at http://pres-outlook.net , comment 1 to 1 out of 1 comments http://pres-outlook.net Fri, 19 Mar 2010 11:41:07 +0100 FeedCreator 1.7.3 http://pres-outlook.net/opinion/guest-commentary/7180.html#comment-3895 As a retired Federal/Military person I have a different perspective and orientation to the PCUSA retirement system as currently designed. As a 'defined' benefit plan the 1.25% of effective salary per year for credit, assumes three key pillars of retirement assumptions that may not carry water. It assumes a church worker will work a full career in the church, 30-25 years for the traditional student who comes to the profession at 25-27 with retirement at 62-65. Even at the current assumed mean of 50K a year or so as effective salary one can only expect $21,875.00 year defined benefits in 2008 dollars. What of that dollar in 2035? Given the large number of second career people, people who drop in and out of full time church work during a working career, or those who just quit, the better plan for all is modeled after the Federal TSP program. Rather than remit the pension assessment back to the home office best to allow a clergy to go to a group 401K with matching by the employing church. Vesting is immediate, portable, and at the end of 30-35 years of working life the return on investment is far more, even in below average market returns, than the defined benefit plan would give. And no 50% reduction at 55 if one chooses to retire at that age. The plan further assumes Social Security will return the same or greater benefits as in the future as now. A risky assumption no matter who is in the Congress or White House. The plan further assumes that one will max out a 403(b). Show me a clergy that does that year for year given the other financial issues in life of kids/older parents/college/cost of gas, you name it. As far as a mix of funds Vanguard or Janus will do one far better than Fidelity over any 1, 3, 5, 10 year average. On the health care side the plan assumes the Medicare system is fully workable in future years. Again a risky bet. Having used the current PPO system as of late, my counsel to all is stay healthy. - peter gregory Wed, 02 Apr 2008 12:00:00 +0100