6 Planned Giving Overview One of the most popular ways to make a gift now, without reducing your income, is through Lehigh’s Planned Giving Program. The following types of life income gifts are offered to help you provide meaningful support to Lehigh while also addressing your personal financial goals and plans. Charitable Gift Annuity Lehigh offers both immediate and deferred payment annuities. A person who enters into a gift annuity agreement with Lehigh is accomplishing two goals — making a gift to Lehigh and securing a fixed income for life. In the case of a deferred payment annuity, the person agrees to wait one or more years before life income payments start in return for a somewhat higher rate of return than the immediate annuity offers. Lehigh bases its gift annuity rates on those established by the American Council on Gift Annuities, a national organization of charities that issue gift annuities. The council reviews rates periodically, at which time rates may be changed for new gift annuities. The annuity rates are lower than those offered by insurance companies, but donors have the satisfaction of obtaining a charitable tax deduction for part of the value of the gift as well as doing something of lasting benefit for the university. The rates have been computed to produce a “residuum,” or gift to Lehigh at the expiration of the agreement, which is on average 50% of the amount of the initial contribution. The rates are based on actuarial studies of mortality experience among gift annuitant lives and consideration for the income rate expected from the invested reserve funds. Beneficiaries receive monthly annuity payments for life according to the terms of a simple contract. These payments are fixed and guaranteed by the revenues and assets of the university. Information may be found online at plannedgiving.lehigh. edu. Pooled Income Fund Lehigh’s pooled income fund is an irrevocable trust fund which operates similarly to a mutual fund. Your contributions are pooled under the trusteeship of Lehigh. All income earned by the fund in each quarter is paid out to the participants in pro rate shares. All dividends and interest must be paid out to life beneficiaries. The terms of the gift are irrevocable, and Lehigh ultimately receives the principal. Charitable Remainder Trusts These gift vehicles have separately invested portfolios, each of which is individually managed by Lehigh or by a trustee chosen by you. These include charitable annuity trusts, charitable lead trusts, and charitable remainder trusts. A charitable remainder trust pays the life income beneficiary a percentage of the fair market value of the trust assets, as revalued annually. This fixed percentage, no less than 5% (as dictated by the IRS), is determined jointly by you and Lehigh’s Treasurer’s Office at the time that the trust agreement is prepared. Income is paid on a quarterly basis.
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