As churches begin creating budgets for the coming year and review their pastoral call packages, PCA Retirement and Benefits (RBI) may be able to lend assistance. We know the importance of annually reviewing call packages, and we even created guidelines for you to follow. Some crucial benefits to reviewing a call package include:

• Minimizing your pastor’s taxes;
• Safeguarding the financial welfare of your pastor and your congregation;
• Ensuring adequate coverage in the case of unforeseen events, protecting everyone involved.

A call package is a pastor’s compensation accounted for as part of a church budget. We can help review call packages on quality and compliance, making sure all the right bases are sufficiently covered. RBI can also help churches structure and review compensation packages for their staff, if needed.

Why review a call package?

• An annual review ensures the compensation is in compliance with the PCA Call Package Guidelines. Churches that fail to provide life and disability insurance benefits assume significant liability. And inadequate retirement plan contributions keep pastors from having sufficient funds when their revenue-generating years come to an end.
• An annual review helps determine how much of the pastor’s salary is designated in advance as part of his housing allowance. Because the pastor’s housing allowance is embedded in his salary, it is important to review and ensure a sufficient amount of money has been designated towards his housing.
• An annual review considers the adequacy of a pastor’s salary. Some pastors rarely receive increases—even after years of service. Consider the needs of his family and the impact that inflation may have had on the purchasing power of his paycheck. According to one of RBI’s Financial Planning Advisors, Dave Anderegg, “It’s very difficult for most pastors to work side-jobs to provide for a shortfall in needed income, so it’s important to drill down and determine how much money he is actually receiving every month to pay bills.” It is not unusual for churches to set aside a lump sum of money in their budget for their pastors’ compensation. However, they and the pastors, might not realize the consequences once allocations have been made for taxes, retirement contributions, and insurance premiums.

It is imperative that churches and pastors don’t just think of compensation as a lump sum but have clarity about how that lump sum will be allocated. We understand the needs of our pastors and know how to structure adequate call packages. PCA RBI often serves as an advocate for pastors when their compensation package is being designed. Our Financial Planning Advisors—like Dave Anderegg—would love to help you start the reviewing and restructuring process.

Please visit our website at genevabenefits.org to contact us, or simply to review our PCA Call Package Guidelines.