Retirement contributions are one part of a complete compensation package. This, in combination with salary, health insurance and other benefits are meant to provide staff with the financial resources to adequately live their lives today as well as protect them in the future.
 

While the for-profit corporate world provides employees with various ways to increase compensation, such as bonuses, profit sharing plans, ESOPs (Employee Stock Ownership Plans), and stock options among others, few things outside of salary, retirement and health insurance exist for people who dedicate a career of service to the YMCA. These benefits become even more critical in protecting our staff in difficult economic times.
 

Retirement benefits are usually provided so that someone who dedicates a career to an organization can retire and maintain their current standard of living. Research by AON Consulting and Georgia Tech University tells us that replacing somewhere between 77% and 94% of a person's final year's salary will allow them to do this.

Income in retirement comes from three sources - Social Security, pension plans and personal savings. Social Security, on average, has replaced 30% of final salary. The 12% contribution rate matters because, at that rate, a person who retires after 30 years in the Plan can replace 53% of their final year's salary with their annuity. (In our Plan, interest rates play an important part in this equation. This calculation assumes the Plan credits 3% interest for the first 10 years, 5% for the next 10 years, and 7% for the final 10 years.) Those who work fewer years, wish to retire at an earlier age or have a lower contribution rate from their YMCA would have to dedicate a significant amount of personal savings in order to achieve these results.
 

YMCAs choose a contribution rate of 8%, 9%, 10%, 11%, or 12% of salary for their staff. Within that contribution rate, YMCAs also determine whether they will require their employees to contribute to the Plan. To compare your YMCA's contribution rate to other YMCAs like yours, click here.

To conduct more research on the matter, you will want to consider comparisons to municipal and national and local not-for-profit organizations in your area. As an example, in you could compare your retirement benefit to those of local teachers in your area, the American Red Cross or the National Girl Scout Retirement Plan. These comparisons will give you some basis to make a decision regarding your YMCA's contribution rate.