Gift Annuities

Gift annuities are a win-win investment choice that allows donors to support their favorite causes and get an income stream in return. Charities will allow Americans older than 60 to make big charitable contributions and in return a donor will get a tax deduction on the gift and the charity will give the donor a monthly payout for life.

Data indicates that there were only 17,000 gift annuities issued in 2009. That seemingly low number is probably due to the less obvious drawbacks. There is no way to gauge the financial stability of charities that you are giving to. One way to lower this risk is to check the value of the charity’s gift reserve and financial assets.

See Reshma Kapadia, Charitable Gifts that Give Back, SmartMoney, Apr. 5, 2012.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.