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Brethren Pension Plan

Bethany Seminary — March 10, 2014. Brethren Pension Plan. 1. High cost of retirement How Brethren Pension Plan works Time and rate of return BBT investments making a difference Context for allocation decisions. Today’s presentation. 2.

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Brethren Pension Plan

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  1. Bethany Seminary — March 10, 2014 Brethren Pension Plan 1

  2. High cost of retirement How Brethren Pension Plan works Time and rate of return BBT investments making a difference Context for allocation decisions Today’s presentation 2

  3. Research indicates average U.S. employee needs 15.7 times final pay (11 times if Social Security is included) High cost of retirement • Age 30 employee — 37 years to normal retirement age • $20,000 gross annual income • 3 percent annual inflation rate $626,900 Retirement savings goal This example of retirement savings needed is based on research conducted by AONHewitt. It is an approximation of the amount of money needed in retirement based on a number of variables that may or may not conform to specific individual needs. This exhibit is intended for educational purposes and is not to be construed as advice. 3

  4. Tax qualified savings —403(b)9 Church Plan Tax-deferred employee contributions 2014 — up to $17,500 pre-tax Join as soon as you are hired Time is key Advantages of your plan… 4

  5. Employer Contributions PCBAC recommended rate — 11 percent Start immediately upon participation 100 percent immediately vested Advantages of your plan… 5

  6. In-Plan Annuity Monthly payments for life! 100 percent of employer accumulations Employee accumulations — flexible distribution Benefit amount can vary May start at age 55 regardless of employment status Survivor benefit — 50, 75, or 100 percent Advantages of your plan… 7

  7. Account management Retirement readiness Web-based tools 10

  8. BBT Investments Asset Classes • Stocks (also called “equities”) — form of ownership • Bonds (also called “fixed income”) — a type of debt • Cash • Other • Commodities • Community Development • Real Estate 11

  9. BBT Investments 11

  10. BBT Investments — SRI 11

  11. Allocation decisions — time horizon • How much time before starting my retirement income? • How long will my retirement be? 11

  12. Allocation decisions — risk tolerance What is yours? Low tolerance — accepting losses ≤ 5 percent (over a 12-month period) Moderate tolerance —accepting losses between 6 and 15 percent (over a 12-month period) High tolerance — accepting losses between 16 and 25 percent (over a 12-month period)

  13. Time and rate of return Savings goal: $1 million at retirement; starting with $0 Two time scenarios: 40 years and 20 years

  14. Time and rate of return • Time and investment returns are levers to reaching your goal • The sooner you start, the easier it is to reach goal 3

  15. Questions? 49

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