Stelter’s Senior Gift Planning Consultant, Lynn M. Gaumer, J.D., is in to give you an update on charitable gift annuity rates.
LIVE, from the American Council on Gift Annuities conference in Houston, it’s an update on gift annuity rates! The ACGA board of directors just announced that suggested maximum CGA rates will stay the same for the remainder of the year.
The ACGA concluded that while interest rates and the 10-Year Treasury Rate continue to fluctuate this year, they have not moved enough to warrant a revision to the ACGA’s return assumption. Therefore, the board decided to keep the suggested CGA rates the same until at least Dec. 31, 2024. The board continues to monitor market and economic conditions and will make changes as conditions warrant.
The ACGA’s rates are designed to produce a charitable gift at the conclusion of the contract equal to half of the funds a donor contributed for the annuity.
Time to Reconnect With Current Gift Annuity Donors
According to the ACGA 2021 Survey on Gift Annuities, about half of new gift annuities are from previous gift annuity donors. So take time to reconnect with them. Many of the current rates are higher than they have been in 16 years. And these higher rates may not last into next year. This may lead to conversations about funding an additional gift annuity with traditional assets such as cash or appreciated stock or using IRA assets to make a one-time election of up to $53,000 in 2024 to fund a gift annuity.
If your organization offers gift annuities, now is the time to discuss their many benefits. If it doesn’t, now’s the perfect time to either create a CGA program or work with a third party such as the National Gift Annuity Foundation to offer them. (The best part about working with a third party is that there is no risk to your organization.)
Next Steps
We recommend you continue to communicate with donors who may be interested in making a gift yet this year to take advantage of these rates. After all, the charitable gift annuity won my vote for best charitable gift for 2024.