A life insurance policy is a tool that can be used strategically to make an impactful gift for the advancement of the gospel. Here are a few basic facts.
The Foundation can be the or a designated beneficiary of the proceeds on a life insurance policy on the life of a donor who owns the policy.
The Foundation can be the applicant/owner/beneficiary of a life insurance policy on an individual who expresses interest in partnering with the Foundation to accomplish this goal. Donors often will make tax-deductible contributions to the Foundation to offset the annual premium costs.
Utilizing life insurance is a simple strategy that does not involve investment risk.
Utilizing life insurance leverages the use of a smaller amount of dollars invested over time that yields a significant payout.
Any age individual may consider this type of gift.
Donors can designate the use of the realized gift.
The following are three examples of philanthropic minded donors that worked with an agent to maximize their gifts to the charities of their choice.
Case Study #1
71 year old female, non-smoker
Owned $50,000 CD that was ear-marked for gifts to grandchildren
She had a desire to make a gift to her church’s building fund
At maturity of her CD, she used approximately $36,000 to purchase a $50,000 single premium whole life policy
At her death, her grandchildren will receive a minimum of $50,000 death benefit
She was able to immediately donate the $14,000 difference to her church
RESULTS: The grandchildren still have $50,000 in tact at her death, and the donor gets the joy of the immediate gift to her church, while she is still living.
Case Study #2
56 year old male, non-smoker, high income earner
After daughter graduated from high school and received a full scholarship to college, he allocated $18,000 per year for philanthropic efforts for several causes in which he was interested
He calculated the death benefit of a fully paid up 10 year, whole life policy with an annual premium of $18,000 (total of $180,000 in premium paid out over 10 years)
RESULTS: Three separate non-profit entities will each receive a $100,000 gift upon his death, for a total gift exceeding $300,000, and he received a charitable deduction of $18,000 over ten years (charitable trust is owner of the policy).
Case Study #3
37 year old male, non smoker
He wanted to participate in the work of the Second Presbyterian Church Foundation
He invested in a $25,000 whole life policy for a $329.16 annual premium, or $27.43 a month
RESULTS: The Foundation will one day receive a gift of $25,000. The donor has the joy of knowing that his sacrifice each year will strategically benefit the ministries of his church.
Gifts of life insurance have a wide range of commitment levels for the donor and are easily designed to fit financial capability. If you would like to discuss a gift to the Foundation using life insurance, contact Vicki Simmons at 454-0034, ext. 193 or vsimmons@2pc.org in the Foundation office.