Joe and Kathy worked for many years building up their nest egg for retirement. While they felt their savings and investments would cover their own needs, they wanted to make sure their three children were provided for in the future. One afternoon, a gift planner from a ministry Joe and Kathy supported each year spoke with them to thank them for their faithful gifts. The conversation turned to the couple's long-term planning goals.
Kathy: We wanted to continue making annual gifts to the ministry. Yet at the same time, I was concerned about sacrificing our children's inheritance.
Joe: Our stock portfolio had appreciated significantly over the years. I wanted to pass these gains on to my family without paying a lot in gift or estate tax.
The gift planner told them about a way in which they could achieve their personal and charitable goals through a charitable lead trust. The trust would pay income to the charity for a number of years. Then the full trust value, plus any growth, would go to their children. The plan would allow them to pass on substantial wealth to their family with little cost or no gift tax at all. It would reduce the size of their estate in addition to helping the ministry further its work.
Kathy: I could see how this plan would be very helpful if the trust was funded with our stock. Each of our children would receive one-third of the trust assets in the future. At the same time, we would continue to make gifts to the ministry each year.
Joe: I also thought the plan was a good one. It would give our children time to learn how to save and invest their future inheritance. So, we set up a charitable lead trust plan that would begin paying income each year to the ministry we supported. The prospect of helping our children succeed in the future while giving to God's work made us pleased with our decision.
Please note: The story, names and image above represent an example of the benefits of this type of estate-planning tool. They do not represent actual donors to GFA.
GFA's charitable unitrusts are administered by WaterStone and can be funded with cash, securities or real estate with a minimum value of $100,000. Income payments from a charitable unitrust may be received quarterly or annually.