Sample Gift Plans
Charitable Gift Annuity
Bob and Mary are getting a little older and they find themselves thinking about the future a lot more than they used to. Not just their future and that of their children, but also the future of Lindner Center of HOPE, an organization they believed in and supported. They wanted to be sure that it will still be doing its job long after they're gone. So, they decided it was time to start making definite plans to help ensure their favorite charity's future as theyll as that of their family.
They started gathering information right here, at this website. Then, they talked to their financial advisors and to the staff at Lindner Center of HOPE. They spent a rainy Sunday afternoon at home with a calculator, a legal pad, and a pile of mutual fund statements.
After looking over the different gift plans available to them, they decided that a Charitable Gift Annuity was right for them. They were reassured that it would pay them income for the rest of their lives – in a fixed amount that they could depend on, and at a higher yield than their CDs or mutual funds were providing them. They liked the income tax deduction they could claim for setting up their Gift Annuity, and also the fact that part of their annuity income would come to them tax-free.
Best of all, their Gift Annuity has allowed them to make a larger gift to Lindner Center of HOPE than they would ever have been able to make in an outright gift or through their estate. They're very satisfied with their decision!
Gifts of Life Insurance
Justin bought a lot of life insurance when his family was young. He wanted to be sure that Bev and his children would be taken care of should anything unexpected happen to him.
Well, he's still around, thank goodness. His children are grown and settled, and they did a little better financially than they ever thought would be possible when they were starting out. Truth is, their family no longer needed all the life insurance coverage he was carrying for them.
That excess insurance was really an asset that was no longer productive for them. They talked about it with their accountant, and she said that they could donate some policies to their favorite charity – Lindner Center of HOPE. They would receive an income tax deduction approximately equal to the cash surrender value of the policies, which would come in very handy at tax time.
Lindner Center of HOPE could either cash in the policies and use the funds for current projects, or hold them for the death benefits they will pay when at their death.
It was a win-win result: they were able to help Lindner Center of HOPE out significantly, but they did it by using assets they had almost forgotten about, and in a way that didn’t affect their cash-flow or family’s security.
Gifts from a Retirement Plan
Tom and Wilma wanted to make a gift to Lindner Center of HOPE in addition to their annual support – a commitment that would make a lasting impact on the organization their whole family loves.
But how to do it? They can’t afford to give away large sums while they’re alive, and their children are counting on receiving most of their estate. Their financial advisor came up with the creative solution. He had been looking over the annual statements from their IRAs and retirement plans.
“There will be more than adequate distributions available from these plans after you retire to maintain your lifestyle and enjoy yourselves a little bit,” he told them. “In fact, I’ll probably be advising you to minimize your withdrawals and keep the accounts growing.
“But, did you know that any balance remaining in those plans when the second of you dies could be taxed twice if you leave the accounts to your children through their will? That’s right – the balances could be subject to both estate and income tax. Your children could wind up with a lot less than you’re expecting them to get.”
His plan? Designate Lindner Center of HOPE as the recipient of all or a portion of the remaining balance in their retirement plans. That transfer will be subject to neither estate nor income tax, resulting in a substantial gift to Lindner Center of HOPE. They are then able to allocate the other assets in their estate to their children, knowing that they can take them free of the double tax that applies to retirement accounts.
The result for them? They solved an estate-planning problem they didn’t even know they had, and found a way to provide long-term support for their favorite institution.
Gift from a Will or Trust
After his wife Karen died, Kurt began to appreciate much more the organizations to which she had been so devoted. Lindner Center of HOPE was always her favorite, and Kurt began to look for ways that his giving could keep her commitment alive.
He decided to make a bequest to Lindner Center of HOPE. Trouble was, he had just re-written his will, and he didn’t want to spend the time and expense of having a new document drawn just to add a bequest to Lindner Center of HOPE.
His lawyer told him that he could set up the gift through a codicil to his existing will. She told him that a codicil is a simple document that makes specific changes to a will – like adding a charitable bequest – but leaves everything else alone. It’s a great solution for making minor adjustments to an estate plan you’re otherwise happy with.
She had the codicil ready for him to sign in two days – and now Kurt can rest easy knowing that the organization that meant so much to Karen will be hearing from her once again.