Stelter’s Senior Gift Planning Consultant, Lynn Gaumer, J.D., is back to share an update on the new schedule of charitable gift annuity rates.
The American Council on Gift Annuities recently revealed a new schedule of suggested maximum gift annuity rates for gifts established on or after Jan. 1, 2020. On average, rates will decrease between 0.3 and 0.5 percent. The top rate will be 9.0 percent for donors who are 90 and older.
The table below shows selected current and new comparative rates. A more complete listing of the current and new rates can be found here.
One Life |
Two Lives |
||||
|
Age |
Current Rate |
Gifts made on or after Jan. 1, 2020 |
Ages |
Current Rate |
Gifts made on or after Jan. 1, 2020 |
|
60 |
4.7% |
4.3% |
60/65 |
4.3% |
4.0% |
|
65 |
5.1% |
4.7% |
65/70 |
4.7% |
4.4% |
|
70 |
5.6% |
5.1% |
70/75 |
5.2% |
4.8% |
|
75 |
6.2% |
5.8% |
75/80 |
5.7% |
5.3% |
|
80 |
7.3% |
6.9% |
80/85 |
6.6% |
6.2% |
|
85 |
8.3% |
8.0% |
85/90 |
8.0% |
7.5% |
|
90+ |
9.5% |
9.0% |
90/95 |
9.3% |
8.8% |
Your Donors Will Benefit—If They Act by Dec. 31
Under the current schedule, Mary, 79, transfers $25,000 in exchange for a charitable gift annuity. She would receive annual payments of $1,775, a rate of 7.1 percent. After the new schedule is in place on Jan. 1, her same gift will provide $1,650 in annual payments, reflecting a 6.6 percent rate.
Now Is the Time
Not only are the gift annuity rates scheduled to decrease, but Stelter research* shows that individuals in the mature and boomer generations are concerned about having enough income to retire. A charitable gift annuity is a great way to receive income and make a gift to a nonprofit organization. As an added benefit, your donors may be able to transfer low-yield securities to fund a charitable gift annuity and increase their income while minimizing capital gains taxes.
Stelter Is Here to Help
We recommend you reach out now to donors who may be interested in making a gift before Dec. 31 to take advantage of the current rates. To assist you with this, we are providing a letter that you can customize and use for your donor communications.
Access our sample copy by clicking on the link below.
*2017 NMI Healthy Aging Database® study sponsored in part by The Stelter Company
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