# LCMS Convention Workbook_St. Louis Missouri_1969_S484
# Machine transcription, uncorrected — CHI Digital Archive (demonstration)

STEWARDSHIP AND FINANCES; RETIREMENT AND BENEFITS 471

the Pension Fund would be adversely affected by mass
withdrawals.

5. Permissive withdrawals would result in selective
withdrawal against the Pension Fund, affecting the ac-
tuarial assumptions pursuant to which the annuity rates
have been established.

6. Federal tax consequences:

a) Withdrawals by members would be subject to
federal income tax as ordinary income to the extent
that the amount is in excess of the members’ own con-
tributions.

b) More serious, in the board's opinion, is the fact
that the mere existence of a right to withdraw amounts
from the Pension Fund, even though such rights are
not exercised, would subject all members having such
right to income tax liability in the year in which such
withdrawal right is granted. In other words, if per-
mission to withdraw were granted in 1969, all members
having such right would be deemed to have construc-
tively received the amount available for withdrawal
and would be required to report the taxable portion
thereof as income in 1969. The taxable portion would be
the entire amount of the employer contributions made
to his account through the years, the interest earned
thereon, and the interest earned on his personal con-
tributions. This would have a particularly harsh impact
on those members not desiring to effect a withdrawal,
because they would have income tax liability without
having the money with which to pay the tax.

It is recommended by the Board of Pensions and
Support that the Synod affirm its decision not to amend
the Pension Plan to permit the withdrawal of account
balances except in the form of an annuity payable at
the time of retirement.

Deferred Annuity

Most of the active workers are participating in the
Concordia Retirement Plan. When an active worker
dies. one who also has an account in the Pension Plan
for Pastors and Teachers, his widow is entitled to a
benefit from the Concordia Retirement Plan and also
to an annuity from the Pension Plan.

The Concordia Retirement Plan pays a generous
benefit which, in many instances, will be reduced con-
siderably when her husband, if he had lived, would have
reached what the Concordia Plans refer to as his normal
retirement age.

The annuity from the Pension Plan for a widow of
perhaps 55 years of age will be much smaller than it
would be if her husband's accumulation in the Fension
Plan could continue to grow for some 10 years or more
and she, being older, would have a more favorable an-
nuity rate.

To illustrate: (an actual case, with figures rounded
to eliminate cents)

Husband died at age 58; his widow was 56

She receives from CRP ______ $225.00 a month
Dependent child benefit 55.00 a month

Total $280.00 a month

But when her husband, if he had lived, would have
reached “normal” retirement age (in this case 70), the
amount his widow will receive from the Concordia Re-
tirement Plan becomes less, namely $74 a month, for
it is then based on the amount her husband would have
received as retirement income from the Concordia Re-
tirement Plan. On the other hand, at the time of her
husband's death, the widow was entitled to an annuity
from the Pension Plan of $73 a month. But if she de-
ferred receiving her annuity until the Concordia Re-
tirement Plan benefit will be reduced from $225 to $74,
the annuity from the Pension Plan, if begun at that
time, would be about $190 a month.

At the time of the husband's death the board, there-
fore, offers the widow a choice of an immediate annuity
or a deferred annuity. The widow does not have to
wait to begin her annuity until the Concordia Retire-
ment Plan benefit is reduced, but may choose to begin
it at any time and receive whatever annuity is due her
at that time.

To date 21 widows have chosen a deferred annuity.

Activities

The Board of Pensions and Support met six times
in 1967 and again in 1968 to carry out its assigned tasks,
with special consideration given to the approval of ap-
plications for retirement, disability, widow benefits, and
special support grants.

District subcommittees render valuable assistance by
giving careful consideration to the support applications
from their respective Districts and by making their
recommendation to the Board of Pensions and Support.

The business of conducting pension and support mat-
ters is taken care of regularly by the St. Louis office.

The executive secretary attended the annual Church
Pensions Conference, composed of representatives of
the pension departments of the various denominational
groups. This conference is probably the best source of
information on activities and developments in the field
of church-pension programing.

Your Board of Pensions and Support solicits your
continued prayers in its behalf and implores the con-
tinued guidance of the Lord of the church in all its

efforts. BoaRD OF PENSIONS AND SUPPORT

WALTER E. LICHTSINN, Chairman
CLARENCE M. Moses, Secretary
Emmett H. FasTENAU
Frep A. HEISLER
Rospert D. Murray
JoHN KNIPPENBERG, Executive Secretary
(12-06)

Report of Board of Managers

for Concordia Retirement Plan

and Concordia Welfare Plan

Our Lutheran Church — Missouri Synod is one of
the half-dozen church bodies which by 1937 had estab-
lished an organized program of benefits for its retiring