Mike Jackson
Well good morning everyone. It’s good to see you today. Glad you joined us for this Leader Care and Church Health Webinar. I’m Mike Jackson, director of the Leader Care Church Health Office, and we’re excited that you have joined us. We are doing a weekly webinar, and today’s topic deals with financial issues.
Let me introduce some of the folks that are gonna be with you today and I hope that you will learn a lot as we listen in and as we try to deal with financial issues in challenging times. Of course, we got Lee Wright, who is the associate in the Office of Leader Care and Church Health. Lee deals with church compensation, financial and tax issues, and a bevy of other things, and Lee is our go-to guy when it comes to all of those questions and concerns regarding finances. And so Lee’s going to be leading out.
We’re also honored to have with us Greg Love from Guidestone, and Greg, it’s always good to be around you and good to participate together. And Greg will take a good portion of the time to share with us and to as well as to be a part of our Q and A. And, of course, Ken Allen is an associate in the Office of Leader Care and Church Health, and Ken has been the brainchild behind all of this. He’s wanted to do these kinds of things, and so we’re excited for his expertise. He’s gonna be guiding the Q and A time that will follow after Greg and Lee make their presentations.
Always honored to have state missionary executive director Dr. Rick Lance with us. He has been so supportive of what we’re doing in these areas, and his heartbeat and concern for our churches has been overwhelming during this time as he’s led us as a state missionary staff, as well as been a source of encouragement to our pastors, to our ministers, to our churches. So Dr. Lance, I’m gonna allow you to share a word of introduction and then a word of prayer, and after the prayer, Lee, you can take over. So, again, everyone, thank you for joining us. Dr. Lance, it’s yours.
Rick Lance
Well, thank you Mike and to all who have joined by webinar, it’s an opportunity for us to consider a very salient issue that would be financial issues and challenging times, and there’s no better authority on that in Baptist life than that of GuideStone. And they’ve worked very cooperatively with us as Alabama Baptists and all Southern Baptists and those of a broader community of evangelicals. We’re glad to have Greg Love here. But as we welcome this day, we know that it’s a gift from the Lord. We also know that we live every day, day by day as a gift. We’re reminded of that probably more now than ever before. So let’s pray together and look forward to an opportune time to learn more about what it means to be a good steward in these most challenging times. Join with me as we pray.
Father, we do thank you for the fact that you’ve given us this day, an opportunity to serve. We’re mindful today that every day is a gift from you. We’re thankful that we can be called of God to serve in the various capacities. We do pray now for our churches, for the health of our churches. Not just financially but holistically. We pray for those who’ve been afflicted by the virus and many who have been impacted by it as caregivers and those on the front lines of being first responders in health and other means. We remind ourselves daily that this is a war of sorts, and in this war, they are the frontline combatants. So thank you, Lord God, that you’ve given us good medical science, that you’ve also given us those who are, since that they have the expertise to guide us, especially now as we think about financial issues. We’re mindful and grateful for those at GuideStone who have been good partners through the years, and we thank you again, Lord, for the gift of life through Jesus Christ our lord who gives us the victory. In his name we pray, amen.
Lee Wright
Thank you, Dr. Lance. I’m so glad that you’re with us today, and all of you who’ve joined us. We want to provide help for you in so many different ways, and especially as you consider financial concerns and concerns as we begin back again. So first of all, if you will go alsbom.org, and there you will find many different kinds of resources. We’re gonna put that page up for you in a minute and then we’re gonna put it up for you at the end, but you have the State Board of Missions and you actually can just go to alsbom.org and there you will find the COVID-19 resources. But if you want to go straight to it, then it’d be alsbom.org/covid-19-resources.
I have just mentioned a couple of different resources that are there. There’s many there, but I wanted to mention a few that prepare for the things that we’re talking about today. So we have a guide for preparing for what’s next for Alabama Baptist churches. That has just been added this week, so I hope that that will be helpful for you as we prepare to reopen someday. And then a quick opinion on the CARES Act, there’s some basic information there and some resources. And then if you have not been involved in online giving or if you want to compare, you might want to take a look at GiveTHREE65 for online giving resources. It is a joint venture between Lifeway and the Alabama Baptist Foundation. So great resources. Another great resource is GuideStone, and we’re so happy to have Greg today, but GuideStone has their own page of GuideStone COVID-19 resources, and I’ve listed the link there for you.
Greg is no stranger to any of us in Alabama, we’re so glad that he is here and he’s been serving in Alabama before, but he has served with GuideStone for many different years. And he is now the director of GuideStone Retirement Solution. So Greg is a great help to us. As Alabama Baptist, we’re thankful for him. And so I’m gonna turn it over to Greg to give us some guidance on our financial health.
Greg Love
Thanks Lee, are you able to hear me? I believe so. Let me just say thanks to Dr. Lance and Lee Wright, Mike Jackson, Ken, and all the other ALSBOM Leadership Team. Honestly, there’s no finer convention than that of the Alabama Baptist Convention. And so so thankful for ALSBOM’s leadership, coming alongside churches, equipping them for ministry, and supporting pastors and ministry leaders. They do such an incredible job, and as a longtime Alabama Baptist and serving in great churches in Alabama, I can firsthand testify to such incredible work that they do. And so let me just share with you some information over the next little while, and just say for the next 15 to 20 minutes I’d like to have a conversation with you about three things. Number one, navigating your church through a global crisis. Number two, important staffing considerations in response to COVID-19. And then number three, managing your retirement through market volatility.
And so just quickly by way of introduction, let me just say that GuideStone stands right alongside you as one provider with one mission and one purpose, and that purpose is to serve you and to serve you well. Obviously that happens through retirement solutions, employer sponsored plans, individual retirement accounts, and executive services. Mutual funds, the largest Christian faith-based mutual fund company on planet Earth, investment advice, we want to be right there alongside you to help you make good decisions as you navigate your retirement savings journey and investment savings journey. We want to be right there alongside you. Insurance, employee health, and life benefits, property and casualty, and many of you that are on the call have probably clients of our property and casualty team, got a great team in Alabama that serves alongside you. Insurance, tailored property and casualty solutions to your individual church’s needs. And then lastly, mission dignity, one of my favorite things that we do at GuideStone. Currently assisting more than 1,700 retired Southern Baptist ministers, workers, and their widows. What a great thing that is, I support that out of every paycheck simply because I believe in it, 100% of everything that’s given goes directly to help those that are struggling in big ways.
All right, so let’s spend some time together, and the first thing that we want to talk about, and I want to say thanks again just for having me and letting me share with you over the next little while, sustaining your church in the midst and the aftermath of a global crisis, navigating your church through a global crisis. Let me say this about churches, I love the local church. Churches are on the front lines of this global COVID-19 crisis. Some are struggling due to canceled services and reduced offerings, but yet others are thriving. I’d just make this statement, unprecedented circumstances require unprecedented faith. I’ve heard faith defined as choosing to believe and live as though the Bible is true regardless of your circumstances or emotions. But we’re facing difficult circumstances, a lot of emotions, but I’m so encouraged to hear the reports of the church rising up and being the church maximizing technology, stretching for impact, being creative, sharing Christ and making a big difference.
Recently, I heard a story of one small church pastor currently in his 70s starting a Facebook account and hosting virtual worship services for a church averaging about 40 or so in worshiping. The first week through Facebook, reaching over 400 in worship online, and then the next week, 770. Technology that once intimidated so many people has now become routine. And I would just make this statement, it reminds me that God owns it all, that God remains in control, and that God is at work. One of my mentors years ago, he defined prayer as this, he said, prayer is assembling all of God’s resources on a given situation. I just want you to know that your GuideStone family is praying for you and for those to whom you minister. And we covenant together with you in it.
Well, quickly let me give you five ways to sustain your church in the midst and the aftermath of COVID-19. Some of these you’re already doing, I know you’re doing an incredible job, but number one would be aggressively managing costs. It’s been our experience through the years that small costs can slip into the church budget for good things that may not necessarily be the main thing. Well, now’s the time to sharpen our scissors and cut all but the essential expenses. Some of the cuts may be for good things or things you can bring back when the situation returns to normal, but for now, I want to focus on the essentials of ministry. Perhaps you can delay some payments or renegotiate contracts. Many companies, at least we’ve found, are willing to renegotiate contracts, but the onus is on us to reach out and have that conversation.
Number two, establish a coronavirus budget. Many of you are already doing this. It may not be possible to cut every expense, but it may be possible to delay expenses or redeploy budget items, work with your staff, your deacons, your committees, and other leadership to identify expenditures that can be delayed or reallocated or otherwise adjusted.
Number three, communicate the need. One of the most amazing stories in scripture is in Exodus 36 as the refugee people of Israel were building the tabernacle. In verses four and five, the craftsmen came to Moses and said that they had much more than enough for the service of the work which the Lord commanded them to do. So in verse six they sent out a command to stop giving, and in verse seven, scripture records, for the material they had was sufficient for all the work to be done, indeed, it was too much. The people of Israel heard the need and they responded. So let me just make this statement, it’s important for us to convey the need in our church and community and how the church has responded. Invite people into your life, record a video message on your phone or computer and engage in social media, carry on the conversation and communicate the need. Outline the need, and implore your people to be faithful.
Number four, make it easy to give. Remind your people of all the ways that they can give. Is mailing an offering to the church still an option? Well, make sure people know that. If online giving is an option, encourage that. If it’s not, there’s a great resource that Lee and others will talk about with GiveTHREE65. It can get your church set up quickly to receive online giving. There’s other resources as well, but that’s one that ALSBOM highly recommends, so take advantage of that.
And then number five, remember that God is faithful. The church has survived numerous pandemics, economic crises, recessions, depressions, global and regional wars, and many other challenges both large and small, but let me make this statement, the current trial is just a challenge. But by the Lord’s leading the church will survive this challenge. We have the opportunity to be Christ’s hands and feet during these days, and he’ll be faithful to provide for the needs of his people. Now’s the time for all of us to rise to the occasion and lead with compassion as well as passion, right? I’m so encouraged to hear the stories of many of you doing just that. There’s a little phrase that can be found on most every page in the Bible, and that is, and it came to pass. And I’d just make this statement, this too shall pass in time. It may be with us for a while, but it will pass in time.
Use these days to lean on the Lord, lead with clarity and confidence, and rest in the promise that we see in Psalm 46, God is our refuge in strength, a very present help in time of trouble. You simply need to be still and know that he is God. Let me also take another moment and let’s talk about important staffing considerations in response to COVID-19. As churches and ministries adapt to changes as a result of the coronavirus, some may be considering budget cuts or even staffing adjustments. Those are tough, tough, difficult decisions.
The next few moments I’d like to outline some of the options that are available should you need to make any employee changes at this time. Number one, you could maintain the status quo, right? This is for those employers staying the course. All staff members remain at their current compensation and continue receiving the same level of employee benefits. The recently passed CARES Act provides relief for employers, including churches and ministries who choose to retain their employees. This legislation offers assistance such as payroll tax credits, tax deferrals and loans. Lee will talk more about that in just a little while. But if a church or ministry receives a small business administration paycheck protection program loan and does not terminate employees, it may be eligible to have the entire loan forgiven. Active employees may still take unpaid, job protected leave for specified family and medical reasons while maintaining group health coverage under the same terms and conditions through their Family and Medical Leave Act, as the law exists and functions as it did prior to the coronavirus pandemic. It’s also important to know that laid off or furloughed employees are not eligible for FMLA. And extended FMLA, the Families First Coronavirus Response Act, FFCRA, is the acronym, it was recently passed by congress, created two new requirements for employers with fewer than 500 employees. Number one, employers must offer two weeks of paid sick leave.
And then number two, unless an exempt small employer, employers must offer 10 weeks of paid childcare leave, specifically for those individuals whose childcare has been impacted by the coronavirus pandemic. And just a quick disclaimer, let me say this, for more information eligibility and pay requirements, you’ll want to visit the Department of Labor website, and incredible resources like what’s available through the Alabama State Board of Missions that serves so well.
But number two, it could potentially reduce pay and/or benefits, right? Number one was maintain the status quo, but number two, reducing pay and/or benefits. You never want to do this, but it could be there’s a situation that you have to. A reduction in medical benefits is generally considered a material change in coverage, and employees must be notified about the change 60 days in advance. State employment laws vary, so check with knowledgeable legal counsel in your area to fully understand any requirements that would apply to you. And if a church received a PPE loan or a Paycheck Protection Program loan and it subsequently reduces its workforce by more than 25%, the loan may not be eligible for forgiveness, but keep that in mind. Number three, reduce the hours of non-exempt employees. Reducing the hours of non-exempt employees may change their eligibility for medical coverage, disability, and life insurance. It may also change the value of other benefits that are calculated based upon their salary, such as term life insurance. Under the CARES Act, state unemployment benefits may be proportionally available for employees with reduced hours. Reduced hours may impact an employee’s eligibility to participate in GuideStone medical coverage continuation. I would say this, simply call us at 1-888-984-8433, and I’m gonna share this again at the end, but call us, keep that conversation going.
We want to be right alongside you. Could also visit us online at guidestone.org to review eligibility requirements. But churches with medical coverage through other carriers should also contact their benefit administrator to discuss their requirements and have a good understanding. Number four, implement a leave of absence or furlough. Employees may be able to remain employees of the church or ministry despite the fact that they are no longer working, and there may be certain benefits and compensation considerations and/or changes. You’ll simply want to contact the church’s business administrator or your church’s business administrator to ask how employees’ benefits on leave of absence may be impacted. For churches with GUideStone coverage, employees on a leave of absence or furlough may quality for GuideStone medical and dental continuation and may be able to continue their life and disability coverage for 12 months, so long as their premiums continue to be paid. Keep in mind that furloughed employees are not eligible for the new expanded FMLA coverage as outlined by the DOL that I mentioned a moment ago. Lastly, number five, conducting terminations and layoffs. This is a scorched earth type approach, right? We hope to never have to do this, but in this situation, the employee’s no longer employed by the ministry or the church. Continuation of medical benefits and dental benefits for GuideStone plans, they can be available for GuideStone plans, keep that in mind. Terminated employees may be eligible for extended state unemployment benefits as outlined by the DOL.
And, again, for details on any of these options, you just simply want to pick up the phone, call us, and talk with one of our helpful representatives or visit guidestone.org/coronavirus for additional information and resources to help keep your life and ministry moving forward during this unexpected season. Again, I have to make this disclaimer, that this is simply for information purposes only, it’s not legal or tax advice, but we’re happy to consult and be right alongside you all along the way, but it’s no substitute for legal or tax advice from qualified counsel. All right, number three on our slide here is managing your retirement through market volatility. In the remaining moments, I wanted to tackle some of the most common questions received from clients and participants during these unparalleled days. I’m gonna try to do this quickly over the next few minutes. Several questions that we receive most commonly, and I think some of these will hit right at home for you. Number one, the volatility and uncertainty of the market makes me anxious. It does all of us, right? What counsel can GuideStone provide? Let me just make this statement, come in close and listen, I would encourage you to never make a permanent decision based upon a temporary circumstance.
Did you catch that? Never make a permanent decision based upon a temporary circumstance. We understand that this is a very challenging time and can create fear and anxiety, making solely emotional decisions or emotionally-driven decisions rarely if ever produce a positive outcome. It’s always good to keep the big picture in mind. Keep your retirement savings goals in mind, and be reminded of this scripture passage in Philippians four, do not be anxious about anything but in everything by prayer and supplication with thanksgiving, let your request be made known to God and the peace of God that surpasses all understanding will guard your heart and your mind in Christ Jesus. Never make a permanent decision based upon a temporary circumstance. Number two, when do you think this uncertainty and volatility will all be over? Well, we really can’t know for sure, right? We can’t know the near or long-term ripple effects from unexpected events like coronavirus. There will be an economic impact in the US and globally, and that impact could likely last for much of 2020 and maybe even beyond that. But since the future’s unknown, we’ll take it one day at a time, one step at a time, and we suggest focusing on things that you can control rather than those things that are outside of your control. And here’s just a few of those. Number one, review your spending habits.
Number two, evaluate your recurring costs, things like cable and streaming services, dining out, lawn cares, those type things, to find more ways to save. Build up your emergency fund. A fully funded emergency fund is six months’ worth of expenses set aside for rainy days like today. Consider paying off debt sooner and increase your retirement savings contributions. You say, well, why should I do that during this downtime? It’s a perfect time to be saving for retirement in the midst of a down market. Number three, is my retirement account safe? I get this question all the time. Investing for the long-term brings with it certain unavoidable ups and downs along the way. The stock market works somewhat like a rollercoaster, there’s ups and there’s downs, there’s peaks and there’s valleys. However, by investing in mutual funds, investors have the added benefit of investment diversification in a large number of companies that operate in a wide range of industries. Diversification can’t eliminate all risk, but it does mitigate risk. It limits investors’ financial exposure to the performance of any individual company in which funds invest.
Also, at GuideStone, be encouraged by this, we utilize a multi manager investment approach, providing an additional level of diversification by working with multiple carefully selected, world class investment management firms. Number four, are my retirement investments with GuideStone FDIC insured like a local bank? Well, the answer is no, because GuideStone is not a bank, and therefore your investments and mutual funds are not covered by FDIC insurance. There’s no guarantee of increasing or permanent value when you invest in a mutual fund. Mutual funds that invest in stock market related instruments are not risk-free, there an investment in fund shares and inherently have some element of risk just by their nature. When you invest in mutual funds, you’re seeking a potential increase in the value of your investments. And in return for the potential growth of your investments you realize that there may be some risk that the amount of your investment could decrease by some or all of its value as the stock market reacts to current trends and circumstances. Well, number five, since I’m nearing retirement, should I sell out with my investments and stay in a money market fund until things calm down? Let me just make this statement, come in close and listen, trying to time the market correctly is risky. There’s a lot of risk with that.
History has shown us that most investors actually end up with a lower account balance by attempting to time the market than if they had simply stayed the course. Keep your retirement goals in your windshield, stay the course. We understand why investors would consider abandoning their long-term strategy due to current circumstances, but attempts to time the market can result in selling low and locking in losses. Historically, the market has shown that times of market decline have been followed by times of market gains. Some reversals of the decline have occurred over a short number of months, while others have taken as long as two or three years. We understand in these circumstances those who opt to make moves based on short-term circumstances risk the benefits of a well-developed long-term strategy. At GuideStone, I would say this, we think the most prudent approach is having an allocation that matches your overall risk tolerance for the long-term. The goals to manage your risk appropriately, both to and through your retirement years. Number six, should I withdraw and reallocate my funds? I would say this, depending on how your funds are allocated through a 403 , an individual retirement account, or an investment account, there can be some tax consequences or plan rules that affect the availability of your funds. Additionally, moving to a different fund could cause you to lock in any losses you’ve occurred.
So remember the following, typically you can withdraw money from a 403 such as your employer-sponsored retirement plan only at termination of employment. If you’re below the retirement age set forth in your plan, there can be serious tax consequences, and honestly that can cost you up to 25% or more of the assets in your plan. So it’s usually not a wise decision. So no one can really predict the future and what the market will look like or when it will return to equilibrium. The key is, and catch this, is weathering any economic storm, the key is to be diversified and focus on your long-term goals. If your long-term goals have not changed, then your strategy most likely has also not changed, but it’s still a good idea to reevaluate your risk tolerance and overall plan to see if adjustments are needed. And I want you to know that GuideStone’s here to help you with that. Number seven, what fund is most appropriate for me? That’s a tough question. In short, it just depends.
Choosing your funds is an important decision, and factors such as your time horizon and risk tolerance will impact it. To help you make the best decision for your personal situation, we’re happy to walk alongside you. You can also see our fund line up on your MyGuideStone account. You can learn about the different approaches to investing, whether that’s you want GuideStone to do it completely for you or you’d like to build your own portfolio, however you’re wired, there’s an investment strategy just for you. We’re also happy to walk you through the investment recommendation tool, and you get an exact recommendation based upon your needs, your circumstances and desires. And so just know that. Number eight, should I put my retirement plan contributions on hold until the current economic conditions subside? Well, let me just say this, two things. First, market volatility should not deter you from your retirement savings strategy. During certain seasons you may consider a temporary reduction in retirement contributions due to reasons such as reduced income or a life event. Over a periodic, market volatility should not solely validate reducing your retirement contributions. Number two, secondly, now’s the best time a great time to review the amount you’re contributing to your retirement account and even consider increasing.
You may not know this, but GuideStone recommends that you make a total contribution, that would be anything that your employer’s putting in plus anything that you’re putting in, a total contribution of 15% or more of your salary toward your retirement account, including both individual and employer contributions. And in the midst of a down market, now’s a great time to be saving well. Can you suspend loan payments if needed? I want you to know that to provide the maximum leniency allowed under law, GuideStone adopted the longest grace period for missed loan payments. If you’ve been impacted by COVID-19, the full CARES Act is already being implemented and we stand right alongside you to help you have a good understanding of all of your options that are available. Number 10, what if your advisor is suggesting an annuity product designed to shield your account balance from market volatility? It allows me to benefit when the market’s up and promises no possibility of decreasing due to a bear market. Is this a good financial move? This is a question that I get a lot. Well, I would say this, the short answer is that it depends upon your unique situation. The longer answer is that annuity products come in various forms and can be very complicated products to understand.
So here’s a few key things to consider before making a decision or interacting with somebody that’s a commissioned salesperson. Number one, determine the type of annuity products your financial advisor is recommending, whether that’s a fixed index or variable annuity. Number two, consider the current low interest rate environment, as you will likely be locking in your money at an historically low interest rate if you choose to purchase a fixed annuity product today. Number three, ask your financial advisor to break down the complexities of the annuity product and how it may perform in different market environments. Number four, compare the advantages and disadvantages of each product. Want to have that in mind, and keep in mind that annuity products typically include surrender fees and/or restrictive withdrawal options should you decide you later want to move to another investment vehicle. And then lastly ask your financial advisor how he or she may benefit from your decision to purchase an annuity since these products are typically heavily commissioned.
All right, well I’ll close with this statement that I opened up with at the beginning, unprecedented circumstances require unprecedented faith. On behalf of your congregations, to those of you that are pastors and ministry leaders, let me thank you for your service to your churches. You’re doing an incredible job. I hope that you’re encouraged and that your churches express their gratitude for you. And I would just say this as we close. For more information, obviously you’ll want to visit guidestone.org/coronavirus, and then I would also say we want to remain in contact with you. Obviously you can follow along with every aspect of social media from Facebook to Twitter to Instagram, LinkedIn, but then also if you would, just write down this number, 888-984-8433. 888-984-8433. GuideStone wants to speak with you, walk alongside you in your financial savings journey. If I could be of help to you in any way, here’s my personal number, 214-720-2871, 214-720-2871. My email’s [email protected], and I’m here to walk alongside you all throughout this time. God bless, I’ll turn it back over to Lee Wright.
Lee Wright
All right, thank you so much, Greg. We sure do appreciate it. And we want to give all of our participants a chance to ask some questions, and so if you’d like, you may use the chat feature on your Zoom meeting, and we’ll feed those questions to Greg and to other panelists here today, and we want to help you during this time. I also want to, while you’re doing that, I also want to mention that our cell phones are available to you. My cell phone is 334-549-1383. If you call my office number, it’ll be automatically forwarded to my cell phone during this time. So let me ask you to chat in some questions and we’ll be glad to help answer those questions. Ken, do you have some for us?
Ken Allen
I do not, not at this point. I don’t know, Lee, if there’s things along the way that you’ve been able, as we’re maybe waiting for some questions, that you’ve been able to see that have been common questions, calls during this time that have come into the office that maybe could help as we get the ball rolling.
Lee Wright
Sure, I want to mention one thing that is a common question right now, and that is about unemployment. Churches have called, they’ve had to lay off some workers, and I hear this very often concerning a church daycare, they’ve had to lay off some workers, and so can our workers receive unemployment compensation? And for decades the answer has been no, for decades and decades, and that’s what Alabama law says. However, it is available to church employees for this emergency time, and if some of your employees went to an unemployment office early in this process they may have been told that church workers are not eligible. However, during this emergency time, church workers are eligible for unemployment. They’re also eligible to receive the additional funds from the federal government of $600 per week through, up until July. So I did want to clarify that because there’s been a lot of confusion about it and basically based on the past law. Now, after this crisis is over, the way that I understand it is that we will go back to the norm of church workers will not be eligible in the future or the Alabama legislature would change the law, one of the two. So I just wanted to mention that one, that’s been a very common question.
Ken Allen
Do you see that question, Lee, that’s in the chat?
Lee Wright
Okay, I have a staff members that want to know if they can contribute to their annuity outside of payroll deduction. I know that usually they can’t, but can they do this at this time? I’ll let Greg answer that question.
Greg Love
Yeah, well let me just say this, for our Southern Baptist churches, we’ve got 46,000 of them, we have one big retirement plan, which is the church retirement plan for Southern Baptist churches. And the gatekeepers on the church retirement plan for Southern Baptist churches is each state convention. And I will highlight that each state convention provides something called protection benefits within that retirement plan. So any time I’ve got an opportunity to share that, I love the ministry of the state conventions going the extra mile to provide these protection benefits which would include a survivor benefit up to $100,000 for eligible participants in the plan, and then also a disability benefit of $500 per month for those that are disabled while working. So always like to highlight those two protection benefits, but in regards to continuing saving through payroll deduction into the retirement plan, that has an employer-sponsored retirement plan, so you always have to chase where the W-2’s coming from and then reducing your salary into the retirement plan. Yes, you can do that. But outside of that, there’s other savings options, right? So somebody can have their own individual retirement account, which is an IRA, or then also they can have an investment account. Somebody at GuideStone could have one investment account. They’re free, they don’t cost you anything. If they’re looking to save for a future purchase, they can have one investment account, or five or 10, however many they would like, but just know that you’ve got a range of savings options if you’re looking for that. If you’re continuing to be employed, you’re still receiving your W-2 from a local church, you’re an employee of a local church, you can obviously do a salary reduction into your retirement account and continue saving during these times and increase that. Or outside of that, IRAs and investment accounts are.
Ken Allen
All right, Lee, you see there’s another one there. If a church has applied for and received the PPP payroll loan, are there any additional tax reporting that is required or tracking necessary?
Lee Wright
That’s a great question. There will be a form to apply for the loan forgiveness. I have not seen that form yet, but there will be a form to do that, and the key thing is that you’re gonna show that you have your, you’ve maintained your employees, you’ve continued to pay them, and you will be showing what you did pay to justify the proceeds of the loan and receive hopefully maximum loan forgiveness. I’ve not seen that form yet. My understanding is that there’s no tax consequence of receiving the loan and getting that loan forgiveness. We’ll be watchful in the near future and we may update our statement about some of the government programs that are available. As I mentioned earlier today, we do have a resource there for at the alsbom.org webpage on coronavirus resources, and you can find that opinion sheet on the CARES Act there. So that’s got some basic information, and also I’ll ask, email me at [email protected], and I’ll be glad to look that up and see if there’s anything else available to us at this point about that. All right, do we have any others?
Ken Allen
Yeah, Pat has asked by email if a subject loan is used for payroll and health benefits, do not have to repay?
Lee Wright
All right, health benefits, in fact, the way that the government, there’s an IRS website Q and A about the loan, and it says that your employment cost, which would be salary and wages, it would also include benefits. And those are the things that can be included in the payroll protection plan loan. Now, the main thing about repayment is going to be if you laid off some of your workers during this time there’s a formula that works on that, and that calculation might result in some repayment of the loan. And the loan will be repaid over a period of not more than two years, it has a very good interest rate as well. So that’s all I know at this point about that, but you can include, the key thing here is you can include benefits.
Ken Allen
She also asked about unused balance being returned.
Lee Wright
Yes, that would be paid back. Now, you can use it for utilities and mortgage interest payments as well, but then other amounts that were not used for those purposes would be paid back.
Ken Allen
Okay. Again, from Paula, the cost also includes payroll taxes, correct?
Lee Wright
What I understand it is your state payroll taxes, they’re included. Paula, send me an email and I will find the resource on that and that to you because of the details about that question.
Ken Allen
All right. I’m wanting just to hold on here for just a second to see if we have any other questions that might come in. We have made multiple calls to pastors and a lot are doing well, but there are also some that you can tell if this thing goes on much longer that it could get harder along the way. Question, what percent of churches in the state have taken the PPP?
Lee Wright
I don’t know the answer to that. I do know that I’ve received a lot of phone calls asking about the PPP, but we have no way of knowing what percentage of churches have taken it.
Ken Allen
There’s another one from Lynn, do you have the government website that you can share with the Q and A about the PPP alone?
Lee Wright
I would start with our webpage, alsbom.org, and in there we have some basic information and then we have links to other information. Some of the best information has actually come from some organizations like Church Law & Tax, those organizations have had some great things. Now, the website about the,
Greg Love
Lee, I’ll just say this, that is available on guidestone.org/coronavirus. And so we’ll have links to BATS and others that are there, and so a lot of external links, not just GuideStone only. And so guidestone.org/coronavirus would be a good option.
Lee Wright
Here is the link that I mentioned earlier about the Q and A.
Ken Allen
Yeah, and again we are recording this, so if you need to refer back to anything certainly you can. There are a couple of other questions here that are related to PPP. What date can we begin taking expenses from PPP alone? Is postdating okay? Greg, any thoughts, Lee?
Lee Wright
Greg, you might want to go ahead on that one, but I would say that it is a specific eight-week period and it would go, at this point there’s new money for funding the PPP loan that has just been approved by Congress, so it does go back to the beginning of April. But they’ve got to get it done between April and the end of June, because that’s when they’re gonna certify it. Greg, any other word on that?
Greg Love
No, I think that does it.
Ken Allen
All right, here’s one, is there a greater potential for audits as a result of taking the PPP? Have you all heard anything?
Lee Wright
No.
Ken Allen
And, again, I think just as you guys have suggested going through making sure that you’re doing all that you can in accordance with the guidance that’s provided will be the necessary safeguards against any potential audits in the future. I know we’re at our typical 45-minute window, but we just want to make sure that we’ve answered any questions, don’t want to belabor this time. I think we have one in Q and A. All right, Lee, it says, we filed for it and it starts the day of the closing according to the bank, this PPP is very fast. So Gregory Beasley mentioned that. We filed for it and it starts the day of the closing according to the bank.
Lee Wright
Okay, and I will mention to do that and check with your bank. They do have a lot more information about the loan, and then also about the way that banks are interpreting the loan information, that has varied just a little bit from one to another, but thank you for your answer on that.
Ken Allen
Well, all right, I think at this point, Lee, we’re at our concluding point. If there’s no other further word from Greg or Lee at this time, I’m gonna just say to you, thank you so much. I know, as having been a pastor in the past for more than 20 years, I had ministry assistants both as a pastor and a associational missionary ask me questions, and I would say, that’s a Lee Wright question. Or that’s an annuity question, annuity board question. A GuideStone question. And so I’m grateful to have both of you this morning with us and grateful for your expertise that we can turn to you guys in this time. It’s certainly challenging, and the questions that we just received is evident of the challenging times that we live in with the loans, that’s unprecedented in and of itself. And so it’s great to be able to, I know that there will be follow-up, and we are here, GuideStone is here to serve local churches. That’s why we exist, and so please do not hesitate to call on us at this time. And I’m aware, guys, with this particular time that there could be some angst and anxiety that comes along with loans and financial crisis. So if it’s okay with you, Lee, I would love to close us at the word of prayer.
Father, it is great to know that you know exactly what is going on in the life and ministry of those who are participating right now in the churches across our state and our convention as well, the Southern Baptist Convention. Lord, I know and I realize that these are times too that financially there are some churches that are struggling, and, God, we want to be aware of the needs that are present, Father, and God that we’re aware that you are ultimately the one who is our provider. And, God, as referred to earlier, you are that refuge, you are the one to whom we know that when all is falling down around us you are the one that we are to run to, press into, trust in in every way. And so, God, while we are prayerfully wise in the things that are offered to us, Father, as we’ve shared in these times, God, make us also aware, Lord, that you are truly our great provider. Again, thank you for these men, thank you for Greg and his continued time and ministry there at GuideStone, and thank you for Lee and all the questions that he answers here in our office as well. And Father, we thank you most of all for Jesus. In his name we pray, amen.
God bless and thank you for being with us.
