Preparing Pastors for the Future: Why Retirement Matters Now

Every pastor spends a lifetime pouring into people, preaching, counseling, visiting hospitals, leading through crisis, celebrating miracles. Yet when retirement approaches, many of these same leaders find themselves unprepared for the next chapter of their lives. Churches love their pastors deeply, but few know how to steward that love through intentional financial preparation. The result is far too many ministers reaching their later years with financial uncertainty instead of peace.

A 2015 survey by Grey Matter Research and Consulting found that 33% of evangelical pastors had less than $10,000 saved for retirement. A 2017 Assemblies of God (AG) study revealed an even more sobering picture within our fellowship:

• 40% of AG senior pastors had under $10,000 in retirement savings
• 37% of ministers under age 45 had no retirement savings at all
• The median retirement savings for AG lead pastors was just $20,000

These aren’t just numbers. They represent faithful men and women approaching retirement without the financial support their churches may have assumed they had.

A Common Story, But Not an Unavoidable One

As I meet with pastors around the country, the pattern is sadly familiar: little to no retirement savings, and church boards unsure how to plan for and support the long-term needs of their pastor.

But it doesn’t have to be this way. Even a modest retirement contribution can make a meaningful difference over time. With intentional planning, churches of any size can help their pastor prepare for retirement.

Why Is Retirement Planning So Confusing?

Pastoral compensation is unique. Ministers occupy a dual status in the tax code: self-employed with the IRS for Social Security purposes, yet employees for nearly everything else. This creates a confusing payroll process and leaves well-meaning boards uncertain about how to properly compensate their pastor.

In addition, smaller churches often assume they cannot afford to support retirement savings when budgets are tight. Some even see a pastor’s financial sacrifice as part of their calling. While faith in God’s provision is essential, good stewardship includes preparing a secure future for those who faithfully serve the church.

Small Contributions, Big Impact

Here’s encouraging news: a church doesn’t need a large budget to make a real difference.

Providing a retirement plan for pastors and staff, simply giving them the ability to make personal contributions, is a foundational step. Better still, even a small church-funded contribution can grow significantly.

For example, $25 per month contributed by the church, alongside the pastor’s own payroll deferral, can grow to more than $50,000 over a working lifetime.* When church boards and pastors work together, the long-term impact is remarkable.