Retirement on the basis of age is ordinarily optional at 6o to 65 and compulsory at 70. A contractual contributory plan allows of greater adjustment to individual needs, the annuities being whatever the sums accumulated will provide at any age chosen for retirement. Contractual annuities also make possible choice of provisions for a member alone, for both himself and his widow, or for a return to his estate, should he die before receiving in annuity payment, the full accumulation to his credit at the time of retirement. When annuity accumulations are used for benefits other than those of retirement on the basis of age, about is usually devoted to such age retirement, 3o% to death benefits and each for benefits in case of withdrawal or dis ability. Disability, withdrawal and death benefits reduce the ben efits at retirement, but teachers appear to prefer the return of their accumulations in these cases, even though they must, in con sequence, look forward to smaller allowances on retirement. Pen sions for retirement on the ground of twenty, thirty or forty years of service, irrespective of age or disability are still common but rapidly disappearing. Such provisions injure the service by caus ing able people to retire early : they may extend retirement to a third or a half of a beneficiary's adult life, and they are so expen sive that their cost has been known to approximate one-third of the entire salary budget.
Allowances in case of disability before the normal age of retire ment are desirable, because of their relief of individual distress and the comfort produced by the removal of apprehension as to possible distress in case of disability. Statistics concerning the incidence and continuance of disability among teachers are, however, as yet so fragmentary and untrustworthy, that it is diffi cult to provide contractual protection against disability. Most pension systems, therefore, provide this protection wholly or largely at the cost of the employer, who is more able than the teacher to bear the variations of this load.
Teachers who withdraw from service before the normal age of retirement should, theoretically, continue to retain the benefit not only of their own deposits but also of the employer's contri butions, and the interest accumulations of both. This is economi cally sound and facilitates desirable changes in teaching positions.
In practice, however, the employer's contribution is rarely cred ited to the teacher who withdraws and his own deposits are some times returned without interest. Also for teachers who die in service before the normal age of retirement, only their deposits with interest are usually paid, sometimes with the proceeds of group life insurance provided by the employer.
For the administration of any pension plan it is customary to have a small hoard or committee, including the superintendent, principal or other educational head of the organization, together with two, four or six other persons, equally representing the em ploying organization and the teachers. It is desirable to specify that any factors in a pension plan can be modified as experience may suggest, by agreement between the teachers and the employ ing organization.
For university and college teachers the local pension plans of particular institutions and free pension plans, like that of the Carnegie Foundation, are being gradually superseded by compre hensive contributory contractual plans such as the Federated Superannuation System of the English universities and, in the United States, the Teachers' Insurance and Annuity Association, which provide contractual annuities for the officers and teachers of some 200 universities, colleges and research institutions.
(C. Fu.) Industrial Pensions.—Among the earliest plans were those of the American Express Company (about 1875) and the Balti more and Ohio Railroad (about 1884). The United States Steel Corporation was also among the first to establish a pension system.
Pensions for employees are now allowed by most railways, many large banks and some industrial organizations because of age or illness after service ranging upward of 15 years. There are prob ably not fewer than 500 industrial pension programmes. Very few of these were in operation before 1900, and probably less than i00 before 191o. Almost all began informally as older employees became incapacitated. Beginning as a sort of charity, pensions in industry are coming to be considered as the economical way to clear the rolls of the less efficient workers, and therefore as con stituting a legitimate charge against production. This change of attitude has resulted in a change of business practice—an increas ing number of industries now setting up annually during the active life of the workers a reserve out of which to provide pensions payable in the future. There is an increasing tendency to permit or require the payment of a part of the cost by the employees through contribution generally made by deduction from pay. The usual contribution is from 2 to 5%, depending on the amount and nature of the benefits granted. In most places the employee's contribution is returned on leaving the service.
The customary pension age is from 6o to 7o, usually 5 years lower for women than for men. The amount of pension is gen erally based on a percentage of the average salary received over a given period of service; sometimes the period over which the average is calculated is as short as three years, but the tendency is to lengthen the period and in the most modern plans, to cover the entire period of service. In view of the fact that pensions when paid constitute life annuities, there is also a tendency to employ the service of life insurance companies in the administra tion of pension schemes. (I. K.) Church Pensions.—The Protestant Episcopal Church was the first organization in America, according to the Journal of the International Congress of Actuaries, to establish a pension sys tem after actuarial calculations. It was planned in 1912, and in corporated in 1914, being placed under State insurance super vision. This was an innovation in English-speaking countries. In 1916, the church under the leadership of William Lawrence, bishop of Massachusetts, raised $8,750,000 to carry the accrued liabilities up to the extent of a $600 a year pension for every clergyman in service when its pension system became operative on March I, 1917. Thereafter the pension system is carried by every Protestant Episcopal Church paying an equivalent of 71% of the salary paid to the clergy. The assets of the Church Pension Fund in 1928 were approximately $25,000,000. The Presbyterian Church in the U.S.A. (North) raised in 1928 the sum of $15,000,000 for the accrued liabilities of their pension system and requires each congregation to pay 71% on salaries and the ministers to pay 21%. Its system is working successfully. The Congregational Churches have a "Pilgrim Memorial Fund" of $5,000,000, the in terest of which helps to pay the 6% contributions on the salaries of those ministers who join ; the church is supposed to pay one half. Other churches, such as the Disciples of Christ and the Meth odist Episcopal Church, are at work on similar enterprises. There are still denominations which have not advanced beyond the plan of "ministerial relief" or are still depending on endowed pensions.