News & Articles


Retirement Plan - Rate and Fees for 2021

Authored by: Jerry Rich
Date: November 17, 2020
FCMM Retirement Plan fees are structured to allow churches to provide a retirement benefit at no cost to the employing church.

Option C Lifetime Fund - Updated February 12, 2021

The FCMM Board of Trustees has set a rate of earnings for the Lifetime Fund (Option C) of 2% for 2021. Option C is a collective investment fund that aims to provide steady long-term earnings to the member. FCMM added a 2% dividend for 2020 year-end balances in Option C. Including that dividend, the effective rate for 2020 was 4.5% (comprising 4% for January-March, 2% for April-December, plus the 2% dividend). Previous rates were 3.5% in 2019, 4% in 2018, and 3% in 2017.

Because of the long-term nature of the Option C Lifetime Fund, invested funds can be transferred to other Options only once in a 12-month period. The Lifetime Fund is structured to offer reliable value towards a monthly income benefit ("annuity") for which 100% of accrued value can be converted. If funds are instead transferred or withdrawn, a fair market value (reduction) may be applied when accrued value is greater than current market value.

For more complete descriptions of Option C and other investment Options, see Retirement Plan Investment Options.

For information about performance and portfolio makeup for FCMM managed funds (Options C, D, and E), see Form 40 Performance Report for the Year 2020.

Fees for Retirement Plan Accounts

As with any retirement investment account, FCMM incurs expenses to provide a compliant Retirement Plan that offers unique benefits for church staff and pastors. While many other retirement plans charge fees to the employer for providing a Plan Document and administration, there is no cost to the participating employer in FCMM's plan.

The Retirement Plan operating cost is funded by a fee assessed to member accounts. In the case of mutual fund Options (Options F, G, and J), the fee is directly deducted after the close of each quarter based on the average daily market value during the quarter. For FCMM managed collective funds (Options C, D, E, and H), the allocated cost is applied before returns are posted; that means returns are net of such fees - already included.

From time to time, the fees may be adjusted to reflect operating costs. For 2021, there will be no changes to member fees except for Option G, Vanguard Funds, which will be assessed a slightly increased fee of 64 basis points (0.64%) annually. For more information about fees, see Form 41 Retirement Plan Fees for 2021.