The Gift Plus Annuity allows a donor to make a charitable donation, increase income for life, lower income taxes, and avoid future investment concerns through a lifetime annuity. Gift Plus Annuities offer safety and peace of mind because the annuity payments are fully guaranteed. The after-tax income is much higher than GICs or bonds can offer and there are immediate tax savings from the charitable donation receipt issued. Donors also benefit from guaranteed cash flow which is free from the uncertainty of changing interest rates.
Here's how it works. In exchange for your gift, the Diocese of New Westminster buys you a lifetime annuity from a licensed insurance company. The amount of your annuity payment depends on your age and the size of your contribution, but the rate will usually be quite a bit higher than what you now get from your investments, and it is fully guaranteed. It will continue as long as you live, no matter what happens to the economy or to interest rates. If you are married, you may choose an annuity which continues as long as either spouse lives.
Here are three examples:
Mr. & Mrs. Browning, both aged 73, contribute $100,000 for a Gift Plus Annuity to support Children & Youth Ministry in the diocese. They get a lifetime annuity of $4,760 per year (238% more than with their 2.5% GIC). They receive a donation receipt for their gift of $30,000. The gift is immediately available for the ministry among families with children and youth.
Susan Richards, 75, more than doubles her income by contributing $25,000. She receives $1,415 a year for as long as she lives with a guaranteed after-tax rate of return of 5.66% compared to her GIC which paid 1.66% after-tax. She makes a receiptable charitable gift to support her parish of $6,250.
Matthew Bertrand, 72, decides to invest in a Gift Plus Annuity with his available $25,000 which was invested in bonds at 2.50%. $7,500 of the transaction is a gift to Care+Share and Matthew’s after-tax income increases to $1,325 from just $414 generated by the bond investment.
All three cases result in the peace of mind that guaranteed cash flow brings.
Call for a detailed illustration specific to your financial situation.