Does a Charitable Gift Annuity make sense for you?
A Charitable Gift Annuity may be an option if you have big dreams and a big heart but a shrinking pocketbook (and resources).
As a professional Insurance & Retirement advisor, I have been asked, “What are some of the non-traditional charitable gift-giving opportunities by which someone may support their church or favorite charity?”
Other than cash, what resources can one use to support charities without depleting the resources that may be needed to support their own needs and lifestyle? I tell these big-hearted people with big dreams but financial constraints that a Charitable Gift Annuity may be an option for them.
The most current way of donating to our favorite church or charity is by giving cash, usually a check. There are advantages and disadvantages to this form of giving. First to note are the tax advantages to giving cash. The charity gift may be deducted from the income tax return (limited to 59% of adjusted gross income). A disadvantage of giving money is that the donor may have limited cash available at the time of the planned donation, making the gift amount smaller than desired. If an emergency arises that depletes the cash resources; sadly, a decision may be made to skip the contribution entirely. These are the times when the donor looks for other options.
A Charitable Gift Annuity is a unique type of annuity that allows donors to transfer ownership of their current stocks, bonds, mutual funds, or other appreciated assets to a registered 501 (3) c non-profit organization. In exchange for the gift, the donor is guaranteed an agreed-on payment to themselves, their spouse if married, their heirs, or the donor’s favorite charity.
Reverent C.J. Taylor, President and CEO of the Heartspring Methodist Foundation, says, “Many persons own appreciated securities paying minimum dividends, which they have chosen not to sell due to capital gains consequences.” (If the owner sells these securities, capital gains tax must be paid on the difference between their tax basis, i.e., the cost of the guards, and value at the time the securities are sold.) When giving appreciated assets, the donor not only satisfies a need and desire to make a charitable gift but can also earn a tax deduction on that gift.
If you dream of supporting your favorite charity, owning appreciated assets, are concerned about market volatility and potential losses, and would like to exit your securities while minimizing capital gain taxes and reducing your income taxes, a Charitable Gift Annuity may be an option for you.
To discover if a Charitable Gift Annuity is the best solution for you and your family, you should first discuss this question with an annuity expert. If you and your advisor believe other investment options should be investigated before deciding how to invest your funds. Your annuity advisor will help you understand annuity features and how they fit into your overall plan. When selecting an advisor, work with agents representing top-rated insurance companies; choose advisors offering safe, secure annuities and providing guaranteed lifetime income without market risk.)
Contact an annuity expert or advisor to discover if a Charitable Gift Annuity is an excellent choice for you and your family. Select an advisor representing top-rated insurance companies and offers safe, secure annuities and guaranteed lifetime income without market risks. Your annuity advisor will help you understand annuities’ features and which are appropriate to your needs and desires. They can also help you investigate other options before you decide how to invest your funds.
You and your advisor can develop a personalized financial plan and evaluate whether a Charitable Gift Annuity may be a unique and generous part of that plan.
As in all important decisions, make sure you understand your actions’ tax advantages and disadvantages. Always consult a licensed and authorized professional before making any final decisions.