A compensation package for a minister of the gospel should reflect the highest esteem and care between the pastor and congregation.
EFCSW recommends the following items be included in any compensation package.
- A salary commensurate with at least a middle level management position in the community.
- An appropriate IRS configuration of the salary package for the best benefit of the minister.
- A total health care package for the minister and family.
- Life insurance planning is also offered through the health care insurance provider.
- A non-taxable reimbursement plan for the expenses of providing ministry.
- A non-taxable vehicle use plan.
- Fees, travel, and housing associated with all EFCSW sponsored events.
- Participation in a shared financial retirement planning tool. This is customarily a percentage withholding of salary and housing with a matching contribution
- from the church. It is best to contribute monthly.
The above compensation expectations are generally encouraged for all fulltime ministry staff.
Savings Plan: A 403(b) Plan Document has been specifically developed for EFCSW staff members, which addresses the particular needs of recorded and commissioned pastors. This plan is also available to pastors within EFCSW.
EFCSW Retirement Policy
EFCSW does not have a written retirement policy. We encourage churches and pastors make the best use of the lifetime of accumulated wisdom, financial resources, and health to serve the kingdom of God in meaningful beneficial ways during retirement. Faith Practice does state that an outgoing Sr. Pastor should not continue to attend the same church unless the incoming pastor specifically requests that they do so.
EFCSW recommends that all ministers participate in the Social Security program.
The benefits are: a disciplined and managed retirement fund; Medicare insurance at 65 years of age; disability insurance in case one cannot work prior to 65 years of age. Anyone who options out of Social Security is also forfeiting the right to participate in these two important programs.
Should Clergy option out of Social Security?
The Internal Revenue Service gives ministers the option of non-participation in the Social Security program. They must choose THIS option within 18 months of receiving their ministry credential. They may re-enter program only if they are willing to re-pay contributions previously owed. The basis for non-participation is conscientious objection to the government, in any form, providing the services of retirement and medical insurance. This objection proposes that such services are the function the church and the family instead of the State.
Finally, as retirement approaches, EFCSW encourages all ministers to seek professional estate planning services to help minimize tax burden for their estate, as well as contributing to the future of the Friends Church.