How to Calculate a Charitable Gift Annuity
There's no shortage of charities that take donations and use them for good causes. Whether your idea of a good cause is saving the planet, spreading medical benefits, teaching kids to read or any number of other charitable endeavors, charitable gift annuities are a good way to give money to a cause you believe in while still keeping an eye out for your personal future and financial well-being.
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Instructions
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Decide on a charity that you'd like to donate to. A charitable gift annuity (CGA) is a deal between a donor and a charity in which the donor gives cash or assets to a charity in exchange for a partial tax deduction and a lifetime guarantee of annual income from the charity. When the donor dies, the charity keeps the remainder of the donation money as a gift.
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Consider the factors that determine the size of the payments from a charitable gift annuity. These include the donor's age, the policy of the chosen charity, the value of the contribution and the number of annuitants. Annuitants are the people who receive the payments from the charity. There can be one or two annuitants.
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Visit the American Council on Gift Annuities (ACGA) website and review payout rates. Many charities use the payout rates defined by the ACGA.
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Contact the charity you would like to donate to and discuss its charitable gift annuity police. Many charities will devote part their websites to charitable gift annuities, including helpful calculating tools such as rate tables and worksheets.
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Tips & Warnings
Most charitable gift annuity donors are retirees who want to increase their cash flow, have the security of guaranteed payments and save on their taxes.
Research a charity thoroughly before donating to it. Just because a charity avows to do a lot of work for a good cause doesn't mean it is efficiently run and managed.
