# LCMS Convention Workbook_St. Louis Missouri_1969_S483
# Machine transcription, uncorrected — CHI Digital Archive (demonstration)

470 STEWARDSHIP AND FINANCES; RETIREMENT AND BENEF ITS

6. We recommend that a continuing allocation of the
appreciation be made each year, the first to reflect 50%
of the increase in appreciation on Jan. 31, 1970, over
that which existed on Jan. 31, 1969, and will be credited
to the Annuity Fund and the Active Accounts as they
existed on Jan. 31, 1969. No charge will be made for
any reduction in the appreciation of the stock portfolio
unless the amount of the appreciation has been reduced
below the amounts already allocated to the Annuity
Fund and the Active Accounts. Should a reduction be
required under these standards, reduction will be made
at the same rate to both the Annuity Fund and the Ac-
tive Accounts. The sum of all such reductions will be
limited so as not to exceed the sum of all allocations
of appreciation.

7. The distribution to the Annuity Fund as described
in item 5 will create additional surplus in this Fund
above that described in item 2. We recommend that this
be distributed as increased annuities in the same man-
ner as this surplus. The overall result is expected to
produce an increase in annuities of approximately 42°,

8. The plan presently provides for the existence of
a Contingent Fund to be used to provide supplementary
benefits and offer protection against investment depre-
ciation. The Work Committee recommends continuation
of the Contingent Fund, as we feel the recommendations
contained in this outline justify a reserve for unforeseen
contingencies.

9. The Work Committee feels that the above recom-
mendations best suit the purpose of the plan and its
original objectives. Furthermore, it recognizes the
existence of the Concordia Retirement Plan and its con-
tribution to the retirement income of the members of
our plan. We feel, however, that these recommendations
should not necessarily stand unchanged until the death
of the last participant of the plan. Instead, we feel that
the results of this Work Committee should be reviewed
at intervals of not more than 5 years and, as a starting
point, these future committees should be charged with
the responsibility of reviewing the following items:

a. Distribution of accumulated surplus in the An-
nuity Fund.

b. Appropriateness of the use of 50° of the appre-
ciation in the common stock fund.

c. Mortality experience of our retired lives com-
pared with assumptions in the annuity purchase rate.

d. Investment yield and outlook for the future in
comparison with the interest assumption in the annuity
purchase rate.

e. While the Work Committee does not recommend
the separation of the various funds into segregated asset
accounts, this subject should also be left open to review.

Passed by unanimous approval at joint meeting of
the Board of Trustees, Board of Pensions and Support,
and the Board of Managers held on March 17, 1969.

Adopted by the Board of Pensions and Support in
a regular meeting held on the afternoon of March 17,

1969. The recommendations were approved in principle
by Synod’s Board of Directors in their meeting on
March 25th. (Synodical Handbook, 10.11, a.)

The Pension Work Committee, in consultation with
Synod’s legal counsel, is to prepare the necessary
amendments to the Pension Plan for Pastors and Teach-
ers to give effect to the above concepts and present the
necessary amendments to the next meeting of the Board
of Pensions and Support for adoption, and to the next
meeting of the Board of Directors for final approval.

It is the view of the committee that if the investment
performance does continue as it has in the past few
years, an increase in the minimum pension to $175 a
month can be realistically anticipated within 3 years,

Special Items
Report on Resolution 10-08 of the New York Convention

The Central Illinois District memorialized the 1967
convention of the Synod to amend the Pension Plan to
allow any member upon request to withdraw his entire
account balance, including the amounts contributed by
employers and the interest thereon.

The New York convention declined the overture, but
instructed the Board of Pensions and Support to study
the legal, tax, and actuarial ramifications of permitting
such withdrawals and to report to the next convention
(Resolution 10-08).

These studies have been made, and the conclusions
of the board are as follows:

1, Permitting a withdrawal from the Pension Fund
by an active worker would be contrary to the concept
and basis on which congregations made their contribu-
tions, which was to provide for the retirement security
of their workers.

2. The Concordia Retirement Plan does not provide
any benefit based on a worker's years of service prior
to coverage under the Concordia Retirement Plan. The
concept underlying the Concordia Retirement Plan was
and is that the worker's accumulation under the Pension
Plan would supplement the Concordia Retirement Plan
benefit and will be the benefit attributable to such prior
years of service. A substantial segment of those retiring
under the Concordia Retirement Plan will need the
accumulation under the Pension Plan to provide a
satisfactory retirement benefit.

3. Investment Consequences: The investments of the
Pension Fund have been made on the basis of antici-
pated levels of future disbursements. If any substantial
part of the Pension Fund were to become subject to
premature, lump sum withdrawal, a substantial part of
the existing investments would have to be liquidated
and, on the current market, would be liquidated at a
loss. The account balances of active members who are
also members of the Concordia Retirement Plan pres-
ently total $50 million. A liquidation of any substantial
part of such total could involve liquidations at a loss.

4, The annuity rates and the actuarial soundness of