Episcopal clergy are more knowledgeable about personal finances and more likely to live within their means than comparable peers in the general population, according to a survey released May 14 by George Washington University and the Church Pension Group (CPG).
But researchers also identified disparities among clergy groups and persistent risks, including some to be actively targeted in a new financial education curriculum from CPG. Among the concerns: 39 percent did not save any money in the past year and 25 percent say they have difficulty paying their monthly bills.
“We certainly see that clergy understand the basics of finance, but implementation in some of these areas really does need some improvement,” said Pattie Christensen, vice president – education at the Church Pension Group. In response to the survey, she said, “we’ve changed some of the messaging at our conferences, especially on financial topics. Now it’s more about how to do something rather than the why” to do it.
The survey was conducted by the Global Financial Literacy Excellence Center at the GWU School of Business. Responses came from 1,053 CPG pension group members who answered questions in November and December 2018. A comparative sample came from a National Financial Capability Study (NFCS) of adults ages 25 and up who are employed either full- or part-time and have a bachelor’s degree or higher.
“Clergy members do better compared to the NFCS sample,” said Andrea Hasler, assistant research professor in financial literacy at GWU, as she presented the report in a CPG webinar. “But still we see that there is room for improvement because still 38 percent do not set aside emergency or rainy day funds for example.”
Researchers found 76 percent of Episcopal clergy successfully answered three key questions about interest rates, inflation and risk diversification. Such financial literacy makes them more likely to have precautionary savings, manageable debt levels and plans for retirement than the 70 percent of Americans who couldn’t answer all three correctly in 2018, according to the report.
The survey also offered a glimpse inside the financial lives of Episcopal clergy. For instance:
- Most (55 percent) earn between $50,000 and $100,000. Nineteen percent earn below $50,000 while 26 percent earn above $100,000.
- 60 percent own a home
- 74 percent of married clergy have a spouse with a retirement plan
- 21 percent have student loan debt
- 50 percent feel they don’t have too much debt; the rest either feel overburdened with debt or “struggle with debt from time to time,” Hasler said.
“Clergy have a lot of assets,” Hasler said. “On the debt side, we see that 38 percent have credit card debt and 85 percent of those who own a home have a mortgage. So that means: assets are leveraged.”
In terms of preparation for retirement, 25 percent said they worry about running out of money. Another 31 percent said they don’t share that worry, while 44 percent did not take a position on whether they share that concern.
Disparities among clergy groups emerged in the survey, which suggests certain factors are correlated with risks for financial insecurity.
“We see big differences among ethnicities,” Hasler said. “African-Americans have much lower financial literacy rates. Hispanics have much lower financial literacy rates. And there we actually compared those who are born in the US and those who are not born in the US. And we see that those who are not born in the US have actually even lower financial literacy rates.”
Marital status also makes a difference.
Clergy “who are married are less concerned about running out of money in retirement,” Hasler said. “That could exactly be because a spouse has their own retirement account.”
CPG is cultivating resources to address needs that drew attention in the survey. Personal finance consultations are available in Spanish, for instance. Clergy carrying student loan debt can apply for debt reduction grants when they attend financial education conferences through CPG’s “Success After Seminary” program. And a new “five years to retirement” curriculum will roll out when CPG resumes having in-person conferences, which are suspended temporarily due to COVID-19.
“We find that by giving people more of a tool to learn how to do something makes more sense than just saying to someone: you should do this,” Christensen said.