By Ed Thompson
Let me tell you a cautionary tale. Some time ago, I got a call from a pastor who used to serve one of the churches in this presbytery. They wanted to know if we had copies of the changes in their terms of call from the church where they had served. We had some, but not all of them. Unfortunately our filing system is not perfect, and to be honest, churches don’t always send us copies of those forms, even though we ask them to do that every year.
Anyway, I said we’d be glad to send them copies of what we had. Turns out, the pastor was thinking about retiring, and when they looked into their retirement account, they didn’t see that the church had paid what they thought they had agreed to pay as part of the terms of call. Actually, they hadn’t paid anything at all. It wasn’t necessarily a large amount – maybe $2,000 a year – but over 10 years, that begins to add up, and with recent gains in the stock market, we might be talking about $25,000, maybe more. That’s not necessarily going to prevent that pastor from retiring, but it could make some difference in their retirement. It might affect what kind of car they can buy, what kind of travel they’re able to take, what kind of gifts they can afford to buy for the children or grandchildren. Maybe they won’t have to eat hot dogs and ramen noodles (unless of course they like hot dogs and ramen noodles.)
Now, there’s a possibility the church treasurer put these funds into a different retirement account, so the money the pastor was expecting might be somewhere after all. It’s also possible that the church will recognize their mistake and make the contributions they had originally agreed to. Even if they do that, though, this pastor will still miss out on the recent gains in the stock market. Since some time has passed since the pastor left, the current treasurer might not be that helpful, and they might not have the records to show how much the church should have been paying. The unfortunate reality is that since they didn’t part on the best of terms, the church might be reluctant – and they might refuse – to make any of these back payments.
The moral of the story: check your accounts at least annually. Check to make sure the church is making payments to your 403(b) account or your IRA. Check to make sure they are making the payments to the Board of Pensions, and if you did get a raise, make sure that’s reflected in your retirement account. For that matter, you should probably check your Social Security account annually to make sure your wages are accurately recorded. Mistakes happen. Honest mistakes happen. Sometimes, people have been known to be passive aggressive if they think you’re being overpaid or if they think you don’t deserve to have any extra contributions to your retirement account. Sometimes, figures get transposed. It probably doesn’t happen very often, but checks do get lost in the mail. You are never going to know unless you keep on top of it.
Yes, it is a hassle to do all this. Yes, you’re busy. Yes, people are basically honest. However, if you think it’s a hassle to double check your retirement accounts every year, think what kind of hassle you’re going to have when you get ready to retire and discover that no, the church didn’t make the contributions they had agreed to make. Or they had forgotten to notify the Board of Pensions that your salary had been increased. Maybe the treasurer wondered why the Board of Pensions dues hadn’t gone up but didn’t bother to ask why since it worked in the church’s favor.
The time to correct these mistakes is when they happen, not 10, 20, or 30 years down the road. Alfred E. Neuman, the fictitious mascot of MAD magazine, once said something like, “You’ve got to learn from the mistakes of others because you’ll never live long enough to make them all yourself.” I think he’s right. Unfortunately, we can probably find examples of that every day. This story is one of them.