Examples: Clergy Like You

The following scenarios offer examples of clergy who retire at normal or early retirement age. For illustrative purposes, these examples are based only on the formulas described in the section How Your Pension Benefit Is Calculated. They do not take into consideration the normal or optional forms of payment, which could change the amount of the benefit.

Overview

Normal Retirement

The Rev. Mary Smith is vested and ready to retire.

  • She is 65 years old (the normal retirement age);
  • She has 28 years and six months (28.5 years) of Credited Service; and
  • Her Highest Average Compensation equals $72,000.

Mother Smith will receive a monthly pension benefit of $3,009.13. Here is how her benefit was determined:

Highest Average Compensation x 1.6% x Credited Service
$72,000 x 1.6% x 28.5
= $32,832
Plus up to the first $10,000 of Highest Average Compensation x 1.15% x Credited Service
$10,000 x 1.15% x 28.5
= $3,277.50
Total annual normal retirement benefit
$36,109.50
($32,832 + $3,277.50)
Monthly pension benefit Mother Smith receives
$3,009.13
($36,109.50 / 12 months)

Early Retirement with Less Than 30 Years of Credited Service

The Rev. John Jones is vested and ready to retire.

  • He has just turned 59 years old, which means he is retiring six years early;
  • He has 25 years and three months (25.25 years) of Credited Service; and
  • His Highest Average Compensation equals $70,000.

Father Jones will receive a monthly pension benefit of $1,819.05. Here is how his benefit was determined:

Highest Average Compensation x 1.6% x Credited Service
$70,000 x 1.6% x 25.25
= $28,280.00
Plus up to the first $10,000 of Highest Average Compensation x 1.15% x Credited Service
$10,000 x 1.15% x 25.25
= $2,903.75
Total annual normal retirement benefit
$31,183.75
($28,280.00 + $2,903.75)
Early retirement reduction factor
5% x 6 years = 30%
Annual early retirement reduction
$9,355.13
($31,183.75 x 30%)
Total annual early retirement benefit
$21,828.62
($31,183.75 - $9,355.13)
Monthly pension benefit Father Jones receives
$1,819.05
($21,828.62 / 12 months)

Early Retirement with Less Than 30 Years of Credited Service

Early Retirement with 30 or More Years of Credited Service

The Rev. Thomas Jordan is vested and ready to retire.

  • He is 58½ years old, which means he is retiring 6.5 years early;
  • He has 32 years of Credited Service; and
  • His Highest Average Compensation equals $80,000.

Since Father Jordan has more than 30 years of Credited Service, he will receive a monthly pension benefit of $3,720 for the rest of his life and, in addition, a monthly bridge benefit of $560 until he turns age 65. Here is how his benefit was determined:

Highest Average Compensation x 1.6% x Credited Service
$80,000 x 1.6% x 32
= $40,960
Plus up to the first $10,000 of Highest Average Compensation x 1.15% x Credited Service
$10,000 x 1.15% x 32
= $3,680
Total annual normal retirement benefit (unreduced for early commencement (prior to age 65) because Father Jordan has more than 30 years of Credited Service)
$44,640
($40,960 + $3,680)
Monthly pension benefit Father Jordan receives
$3,720
($44,640 / 12 months)
 
+
Monthly bridge benefit equal to $17.50 x Credited Service (ends at age 65)
$560 (until age 65)
($17.50 x 32)

Early Retirement with 30 or More Years of Credited Service