Tom’s Plan for Lifetime Income and Charities’ Future Benefit
A longtime friend of Westminster Canterbury Richmond and other charitable organizations, Tom Jefferson has created several deferred charitable gift annuities over the past 10 years.
A charitable gift annuity is a simple contract between a donor and a charity. With a generous irrevocable gift of appreciated stock to Westminster Canterbury Foundation, Tom established a deferred charitable gift annuity in 2010. In return for his stock gift, Westminster Canterbury Foundation agreed to carefully invest the gift and pay a fixed sum annually to one or two people. Tom chose a single annuitant, his wife Anne. Instead of opting for annuity payments beginning immediately, Tom directed that the payments begin in 2015, five years after his gift. This choice will result in a higher fixed annual annuity payment.
Aside from the satisfaction of helping charities he believes in, Tom likes deferred charitable gift annuities for several reasons:
Tax benefits: Tom likes the charitable income tax deduction he receives in the year of his charitable gifts. By giving appreciated stock to a charity, he avoids some capital gains tax he would owe if he sold the shares.
An effective retirement income strategy: Arranging for higher payments in Tom and Anne's later retirement years was more important to Tom than receiving immediate income. "My presumption was that Anne and I might need more money later in retirement, in case of rising health expenses."
A secure hedge against other financial losses: No matter what fluctuations the economy undergoes, all charitable gift annuities pay a secure fixed amount each year. Those payments will continue for the rest of Anne's life. Tom commented, "If I died first, Anne would lose the benefit of my Social Security, which is larger than hers. These annuities provide protection for her against losses like that."
Someday, the remainder of the Jeffersons' 2010 gift and its invested proceeds will help fund Westminster Canterbury programs and services.