Just as "Baby Boomers" reflect the aging of the U.S. population, so too more of the diocese's priests are entering retirement age and living longer.
To help meet this challenge, a second collection specifically to benefit the Priest Retirement Benefit Trust of the Diocese of Oakland is scheduled for the weekend of Sept. 9 and 10.
"The priests of the diocese have taken care of our parishioners, providing pastoral and spiritual care and the Sacraments. Help me in taking care of these priests in their retirement as they have provided for you," asks Bishop Michael C. Barber, SJ.
As of Jan. 1, 2017, there were 57 retired priests in the diocese — these are diocesan priests, religious order priests are provided for separately by their respective congregations.
Many more retirements are expected in the coming years and the number of retired priests may jump to 70 priests by 2025, according to Eric Waldschmidt, vice president at Nicolay Consulting Group, San Francisco, actuaries and retirement plan administrators serving the diocese.
There are about 169 active and retired priests serving in the diocese, and an additional 178 religious order priests.
The diocese anticipates priests will retire at age 70, though some choose to continue working. Currently the average retirement age is 68.4; the average current age of all retired priests is 78.5. But like the general population, priests are living longer, meaning they require support for a longer time.
The value of the retirement fund is about $16 million. It averaged an 8.8 percent return last year, and 4.6 percent a year for the last three years.
The average annual retirement income benefit per priest is about $23,700. Health care and other benefits, like dental and long-term care, are funded separately.
"The good thing about this fund is that it is established separate from other diocesan assets," said Rev. Paul Vassar, who retired last year after a long career as a pastor and diocesan administrator, including serving as chancellor. Father Vassar is also on the advisory board of the retirement fund.
"It ensures priests who have worked for the diocese will have money to live on when they retire," he said. "They have given their lives to the diocese and we want to make sure they have sufficient funds to cover essential and basic needs."
It's important the average Catholic remember priests face many of the costs lay people do: housing, transportation and other costs.
When priests retire, they must provide their own housing. Most have two options, Father Vassar explained: If they saved and have the resources, they may find their own living situation. Or, if they can arrange it, they can live in a rectory and pay $600 a month for room and board. Priests who maybe haven't saved enough to afford that modest amount, he said, can provide commensurate services in lieu of payment in parishes by saying Masses and working part time at a parish.
Gary Cline, chief operations officer at Nicolay Consulting, explained the priest retirement plan is a defined benefit plan, to which the diocese makes annual contributions based on how much is needed to fund benefits paid.
There are tight controls, he said, to aid in maintaining benefit levels. If investment returns aren't enough, or if priests live longer than the actuaries estimate, the diocese must make up the difference in contributions or curtail benefits.
Retired Rev. Msgr. Tony Valdivia reminds us priests never really retire. "The retirement fund of the diocese is more than helpful," he said. "It helps us live more calmly, in tranquility and peace.
"It also helps us enjoy a few luxuries in our retirement, and helps us not be so dependent on our families.
"And it lets us know a lot of people in the Diocese of Oakland are out there supporting us."
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