Smith College: The Future of Smith

You may be able to make a charitable gift and increase your annual income, especially if you have low-interest CDs or stocks that pay low annual dividends.

A charitable gift annuity offers you a way to support Smith and lock in a fixed, high rate of return in place of the low rates CDs and money market accounts are paying. Rates are based on age, and range from 5.7 percent for age 60 (the minimum age) to 11.3 percent for ages 90 and above. Click to view charitable gift annuity rates

You can diversify your income with minimal capital gains taxes. Transferring appreciated assets to a charitable remainder trust can alleviate your capital gains tax issues and diversify your income-producing investments—all while making a charitable gift and receiving a charitable income tax deduction.

You can turn real estate into income. If you plan to downsize from your primary residence or have vacation property that you no longer want, these real estate assets could be used to fund a charitable remainder trust that produces income for your lifetime or for a loved one.

Case Study
Dale’s inherited family cottage in Maine, although a beloved vacation destination, is expensive to care for and entails a lengthy trip to visit. The cottage is worth $220,000—a large percentage of Dale’s total net worth.

Here’s how Dale can turn the cottage into a meaningful charitable gift and create an income stream:

Dale donates the cottage to a charitable remainder trust
Trustee sells the cottage and reinvests in a diverse portfolio of liquid assets
Dale claims a charitable tax deduction of $69,000
After the property is sold (in the trust), Dale and her partner receive lifetime income from the trust at a 5 percent rate

After the deaths of both Dale and her partner, the trust principal benefits Smith College.