A charitable gift annuity is one of the easiest ways to make a life income gift. It is a simple contract that guarantees a specified rate of return or income to the donor in exchange for a gift. The rate of return is based on one's age and is generally higher for older donors. Gift annuities may be funded with either cash or securities with a minimum gift of $25,000 or more.
A charitable gift annuity may allow you to maximize your current spendable income and enjoy the security of a fixed rate of return.
A charitable gift annuity is an agreement between you and the Colleges. In exchange for your gift of cash or marketable securities, we promise to pay you and, if you wish, another annuitant an income for life based upon your age(s). You will receive an income tax deduction for a portion of the amount transferred for your gift annuity.
A portion of your annuity payment may be a tax-free return of your investment in the annuity. If you fund the annuity with appreciated securities, you will be able to report the capital gain associated with the value of the annuity over a period of years. Therefore, the income tax you will owe on your annuity payments may be taxed on three levels: tax-free, as ordinary income, and as capital gain.
You may also defer your income payments to a predetermined date in the future by creating a deferred gift annuity. Every aspect of the deferred annuity is the same as the standard gift annuity except that the payments are deferred for at least 12 months and the income rates are higher. The deferred gift annuity provides you with a future fixed income stream that could be used to replace other sources of income.
Look at some specific rates on current gift annuities. A graphic example of a charitable gift annuity is available as well.
Example: Ben Wolcott, age 54, would like to make a gift to the Colleges' campaign that will also count toward his classes' 35th Reunion goal. At the same time, he wants to plan well for his retirement which he hopes will take place in 10 years. If Ben created a gift annuity today for $30,000 and deferred the income for 10 years, he would receive a deferred gift annuity rate of 8.58 percent*. He would receive an income tax charitable deduction of $2,868 this year and a portion of the income, once received, would be tax free. Ben could fund the deferred gift annuity with cash or marketable securities. By completing this gift, Ben supports the Colleges' capital campaign, helps his classes reach their Reunion goal and most importantly, secures a fixed income payment for his retirement.
*These rates are based on the recommended rates by the American Council of Gift Annuities as of July 15, 2003. These rates do change periodically; please contact the Office of Gift Planning to receive the most current rates.
Please Note: Gifts of this nature should be carefully considered in relation to your comprehensive financial and estate plans. We strongly recommend that you consult an attorney and/or financial adviser before completing a planned gift to the Colleges.
Thank you for remembering Hobart and William Smith Colleges.
Howard "Spike" Davidson '55 & Jackie Askin Davidson '55 are used to taking chances and living life to the fullest. They met on a blind date set up by classmate Gary Getman, got married during their senior years at Hobart and William Smith Colleges, went off to Cornell where Spike got his master's in business, had two lovely children, started an accounting firm and sponsored a Vietnamese immigrant family.
Now, in the year of their golden anniversary and their 50th Reunions at Hobart and William Smith, they are celebrating their lives by enabling others to take chances as well.
Spike and Jackie have supported the Colleges throughout the years as volunteers and with contributions to the Fund for Hobart and William Smith. This past year, they decided to go a step further and join the Colleges' Wheeler Society. They worked with the planned giving staff to create a charitable gift annuity. Their gift will pay them income for their lifetimes, while providing for the Colleges' future.
"We decided it was time to give back to the communities that were so important to us throughout our lives," said Spike Davidson.
Thank you for your interest in supporting Hobart and William Smith Colleges.
There are several ways to make your gift to the Colleges:
If you have any questions about giving to the Colleges, or to give to a designation not listed below, please contact Beth Pier at (315) 781-3079 or pier@hws.edu
