Think of a Charitable Gift Annuity as a way to do good while also doing well for yourself. It’s easy: you make a gift to a charity (through the Foundation), and in return, you receive fixed payments for life. The size of those payments is based on your age and whether the payments include you or you and your spouse. After your death, whatever remains of your gift supports your chosen charity in perpetuity.
If you’ve been thinking about ways to support your favorite charity while also securing some predictable income for yourself, here’s some news worth noting: With inflation continuing to cool, the Fed is set to cut interest rates for a second time this year in late November. However, Charitable Gift Annuity Rates will not be adjusted until January 1.
Why Are People Talking About CGAs Right Now?
A few details make CGAs particularly worth considering:
If you’re 70½ or older, you can take up to $53,000 from your IRA to set up a CGA, and it counts as a Qualified Charitable Distribution (QCD). You won’t pay income tax on that money, and it can count toward your Required Minimum Distribution.
In addition to the annual payments you receive from your CGA, you may also receive a charitable tax deduction in the year of your gift for donations of cash or stock.
With current interest rates still relatively high, the payment rates for new CGAs are quite attractive. Here’s what that looks like in real numbers:
How Does the Foundation Fit In?
We take care of everything – from setting up the gift to sending your payments and managing the investments. Starting a CGA is simple.
1) You sign a simple contract to establish your Charitable Gift Annuity.
2) Decide what assets you want to use to fund your CGA.
3) Transfer those assets to the CGA fund.
4) Begin receiving quarterly payments for life.
The Foundation is here to help you understand your options and figure out if a CGA makes sense for your situation. If you’re interested, we can walk you through how it all works and answer any questions you might have. Contact: Monika Collins, mcollins@delcofoundation.org or 610-744-1015.
