ENDOWMENT SERVICES. 2 Endowments. 18 Covenant Endowment Trust. 20 Bequests. 22 Creative Giving. 24 In It Together

Transcription

1 ENDOWMENT SERVICES 2 Endowments 18 Covenant Endowment Trust 20 Bequests 22 Creative Giving 24 In It Together

2 It s all about the future it s all about the future... Growing Your Ministry through Endowment Covenant Trust Company Endowment Services

3 It s all about the future A man has made at least a start on discovering the meaning of human life when he plants shade trees under which he knows full well he will never sit. D. Elton Trueblood Quaker theologian

4 What is an Endowment Fund? It s all about the future An Endowment Fund... is a fund established to benefit mission and ministry demonstrates commitment to the future of the ministry is established by a written agreement which defines the purpose, distribution amount and guidelines for administration provides a lasting income stream for its designated purpose invests for the long-term, and generally pays out only a set percentage of the assets so the fund can grow over time is different from special funds that may fill more short-term needs, e.g. a building fund, emergency or rainy day fund gives donors confidence that their contributions will be managed well and used for the designated purpose is a place where members and/or supporters may designate legacy gifts A significant gift to the endowment will not overwhelm or discourage on-going annual giving, as the purposes are distinct. Many universities have Scholarship Endowments that provide funding for students who might not otherwise be able to attend the school. These endowments are frequent recipients of significant legacy gifts. is a way for your institution to lead by example in good stewardship of resources is one way your institution can dream big and make those dreams come true Growing Your Ministry through Endowment Covenant Trust Company Endowment Services

5 Your Endowment Action Plan It s all about the future First steps in developing a plan for your Endowment Fund: An ad hoc committee may be appointed to investigate the need for and potential purposes of an Endowment Fund. This group usually reports to the executive board or church council, which then approves the establishment of an Endowment Fund. An Endowment Fund Committee is then elected by the board, council or entire membership, and given appropriate authority regarding the Endowment Fund. This committee should include those with a sense of mission for the ministry, committed to stewardship, with knowledge about legal and/or financial matters. This Endowment Fund Committee is charged with: determining the designated purpose of the Endowment Fund which keeps the ministry focused helps develop support [and gifts] for the Endowment Fund helps insure the long-term integrity of the Endowment Fund developing initial support for the Endowment Fund gather a nucleus of supporters who will make both initial and legacy gifts to the Endowment Fund and are willing to talk to others about doing the same those included in the core group might include ministry leaders, board or council members, stewardship committee members, donors with a long history of support and giving, those who have expressed a long-term vision for your ministry, etc. setting up the infrastructure of the Endowment Fund research and implement proper method of establishing a formal Endowment Fund document within ministry s constitution and/or by-laws, including formal name of the Endowment Fund

6 Your Endowment Action Plan It s all about the future annual distribution percentage [generally around 5% of the assets] how and when distributions are to be made method and chain of authority over administration and revisions of the Endowment Fund other ministry-specific criteria regarding the Endowment Fund establish system for receiving, receipting, and adding gifts to the Endowment Fund determine the Investment Manager for the Endowment Fund and take steps to open the account establishing a marketing plan for the Endowment Fund, which may include ways to encourage contributions share information about the Endowment Fund highlight distributions and their effects or benefit There are many aspects to establishing and managing an Endowment Fund for your ministry. The list above is not complete, but reinforces the fact that an Endowment Fund is a long-term commitment on the part of your ministry, its leadership and supporters. Two other important things to remember: Covenant Trust Company is ready to partner with you in this commitment. Our representatives will meet with your ministry whenever you need help along the way. Ministry leadership should consult with your legal counsel where appropriate during this process. Growing Your Ministry through Endowment Covenant Trust Company Endowment Services

7 CTC Endowment Services It s all about the future Covenant Trust Company Endowment Services are specifically designed as an ongoing resource for your ministry in planning, establishing and managing your Endowment Fund. We presently manage $100,000,000 in endowment or similar accounts for institutional clients, and an additional $9,000,000 in a pooled Endowment Trust. Here are some of the ways CTC can help: Meet with leadership during the initial stages of Endowment Fund planning Provide educational resources and presentations for both leadership and supporters, including Philosophy of endowments How endowments work Various ways to give to endowments Investment management for endowments Discuss specifically how CTC can work with your ministry to implement your Endowment Fund Provide professional investment management for separately created and managed endowment funds with an initial balance of as little as $10,000 Work with you to create an appropriate investment plan with ongoing portfolio management Discuss your ministry s goal for the Endowment Fund, as well as its risk tolerance in achieving that goal Provide periodic reporting to leadership and/or Endowment Fund Committee Provide additional perspective during periods of market distress Work with individuals who may be interested in making planned or deferred gifts to your ministry and/or its Endowment Fund

8 CTC Reporting, Support and Fees It s all about the future Covenant Trust Company provides investment management aligned with your values to achieve your goals. We provide reporting, resources and support for your Endowment Fund program, and many other aspects of your ministry. Our goal is the success of your ministry. Serving as a fiduciary brings a significant level of responsibility and liability to Covenant Trust Company; and there is a fee for these services. Our fees are right in line with the industry averages, and are easily identified on account statements. We intentionally price our services this way to ensure that all who are interested in the value and values CTC brings to the table can take advantage of our high quality, professional trustee and investment management services. We understand that your Endowment Fund may start out small, and take some time to grow. CTC is willing to discuss fee incentives that can help during this initial period. What can you expect to receive from Covenant Trust as your asset manager? assistance in deciding on an appropriate investment objective detailed portfolio performance evaluations regular account statements evaluation and advice regarding the cash flow and return expectations for your Endowment Fund prompt distributions from the Endowment Fund as provided by the Endowment Fund Agreement regular visits from your CTC representative to answer questions, provide educational opportunities, or work with individuals who wish to include your ministry and its Endowment Fund in their financial and legacy planning Growing Your Ministry through Endowment Covenant Trust Company Endowment Services

9 How Can Donors Give to your Endowment Fund? It s all about the future Once your Endowment Fund is in place, there are several ways donors can make gifts: Outright charitable gift [cash or check] designated for the Endowment Fund Memorial or Honorary Gift Designate the Endowment Fund as the beneficiary of an IRA Life insurance proceeds Designate the Endowment Fund as the policy beneficiary Gift the insurance policy itself; consider annual gift to ministry to offset premium payment Gifts of assets like stock, bonds, or real estate Name your ministry and the Endowment Fund as a remainder beneficiary in a charitable trust, revocable living trust, or charitable gift annuity Other legacy gifts, such as a bequest from a will Your ministry can contribute as well, by designating a percentage of its annual budget for the Endowment Fund Covenant Trust Company can assist your organization by meeting with donors to find appropriate ways to include your Endowment Fund as part of their charitable and legacy giving. Even if I knew that tomorrow world would go to pieces, I WOULD STILL

10 Encouraging Giving to your Endowment Fund It s all about the future the Once your Endowment Fund is established, explore various ways to encourage supporters of your ministry to continue giving to the Endowment. Consider setting an example by including the Endowment Fund for a percentage of your ministry s annual budget Publicize the need to grow the Endowment Fund Schedule an annual Endowment Fund Giving Day for your ministry Contact potential givers individually Sponsor educational events to show your supporters how they can support the Endowment Fund Publicize [with permission] gifts to the fund and ask the donors to write or tell in person why they made the gift Publicize distributions from the Endowment Fund and show how they benefit ministry Suggest the Endowment Fund as a destination for memorial or honorary gifts For churches, include mention of the Endowment Fund in new member orientation classes Ask members of the council/board, Endowment Fund Committee, and other ministry leaders to encourage giving in personal conversations; and to make an annual contribution themselves [perhaps a tithe of their tithe] Put a page about giving on your ministry s website; and include mention of the Endowment Fund there, together with a link to Covenant Trust Company s website [ PLANT MY APPLE TREE. Martin Luther Growing Your Ministry through Endowment Covenant Trust Company Endowment Services

11 Celebrate! It s all about the future Any endeavor that requires sacrifice and long-term commitment needs a little celebration to make it all worthwhile. It s the same with your Endowment Fund. One of the most important parts of making it work is to celebrate. During the year, celebrate current gifts that are received Acknowledge each gift individually Always include an expression of thanks with the gift acknowledgement If your ministry has included the Endowment Fund as part of the annual budget, mention this gift as well Schedule an annual celebration centered around your Endowment Fund Use it as an opportunity to summarize total gifts received List names if appropriate Thank all who gave during the year Pray for continued support Pray for those people or ministries who benefit from the Endowment Fund distributions If your Endowment Fund supports broader causes than your local ministry, invite representatives to speak at your annual Endowment Fund celebration. They can both express thanks and talk about what the Endowment Fund distributions have enabled that might not have been possible otherwise Celebrate and report on the periodic distributions from the Endowment Fund Talk about the impact of these funds Remind supporters it is their gifts that make this possible If your Endowment Fund receives a legacy gift from a trust or estate, ask a family member to write or speak briefly about why their loved one chose to include the Endowment Fund in his/her legacy plan Don t miss the opportunity to encourage other supporters to use their legacy plan for Endowment giving as well

12 Manage with Integrity It s all about the future Those overseeing your Endowment Fund are charged with insuring the long-term integrity of this fund. General oversight of your Endowment Fund may be handled under official corporate structure of your ministry The Endowment Fund Committee focuses on defining the fund s purpose, then educating, motivating, celebrating, thanking and distributing gifts to ministry. Investment management should be outsourced beyond the Endowment Fund Committee to assure professional management and avoid any conflict of interest. Sound stewardship principles and the best interests of your ministry [and its supporters] are the primary consideration in where and how the funds are invested The Endowment Fund Committee may monitor endowment fund activity and performance through review of statements and meetings with investment manager. may provide a progress report at least annually to the ministry supporters. will make regular distributions according to the endowment fund agreement. will seek additional funds to grow endowment for increasing impact. Prompt and tax-appropriate acknowledgement of all gifts will be made to every donor, as well as a written expression of the ministry s thanks Growing Your Ministry through Endowment Covenant Trust Company Endowment Services

13 About Covenant Trust It s all about the future Covenant Trust Company is your partner in ministry. We ll work with your institution and its members: To strengthen the resources you already have To generate and manage new resources for the future To be a good steward of your ministry s resources as part of its legacy for tomorrow To advance your ministry by achieving your goals Here are some more important things you should know about Covenant Trust Company [CTC] CTC is a for-profit Illinois Trust Company owned by its founding shareholders: Covenant Ministries of Benevolence, North Park University, and The Evangelical Covenant Church Covenant Trust Company currently manages nearly $700,000,000 in endowment funds, individual and institutional investment management accounts, personal and charitable trusts, charitable gift annuities, and Individual Retirement Accounts CTC has been providing professional trustee services and asset management for more than thirty years We seek to be a mission partner providing comprehensive financial management and legacy planning resources to individuals, charitable organizations, and ministries both inside and outside The Evangelical Covenant Church We share with our clients common values including excellence, integrity and commitment to ministry, reflected in our disciplined strategy of prudent and transparent investment management with a long-term perspective Covenant Trust Company is a unique resource for your ministry that puts financial management tools right at your fingertips. Everything we do has its foundation in stewardship; managing the resources that God has given in a way that will honor Him and help to do His work.

14 Other CTC Resources It s all about the future Covenant Trust Company has many resources available to your ministry and its supporters, including Professional trustee services Revocable living trusts Irrevocable charitable trusts Traditional and Roth Individual Retirement Accounts Professional asset management Investment Management Accounts for individuals and institutions Endowment accounts Retirement Planning Available to individuals [including ministry staff] for getting to retirement and through retirement Traditional and Roth Individual Retirement Accounts Retirement Central on our website at Retirement Calculators FAQ about IRAs and retirement planning Legacy Planning Revocable Living Trusts Charitable Remainder Trusts Charitable Gift Annuities Wills and Powers of Attorney Educational Presentations Several finance related topics available, including sessions especially for women Resources for Local Ministry How to process stock gifts Non-cash gifts to a capital campaign Personal planning for pastors, staff members and leadership Electronic and printed resources for your ministry s newsletter, bulletin boards, bulletin inserts, handouts Extensive website resources for ministry and individuals Growing Your Ministry through Endowment Covenant Trust Company Endowment Services

15 Contacting Covenant Trust Company It s all about the future We invite you to contact us if you re interested in more information or getting the process started. By telephone Toll free Local By info@covenanttrust.com Website CovenantTrust.com For specific information about Covenant Trust Company Endowment Services, contact Ann Wiesbrock, President apwiesbrock@covenanttrust.com William Moucka, VP of Investments & Business Development wymoucka@covenanttrust.com Of course, you can always contact your local CTC Financial Services Representative [see our website at CovenantTrust.com for a directory.] Information contained in this brochure is presented for purposes of information and education only. It is not intended as either tax or legal advice, nor are items listed in order of importance or priority. Consult your own legal, financial and tax advisors for professional help.

16 It s all about the future In this complicated world, with its constant flow of information, news, commentary and worry about the future, we all need some peace of mind. That s where Covenant Trust Company (CTC) comes in. There is peace of mind in knowing that someone is watching over your assets, growing what you have and protecting it for the future. There is great peace of mind when the values of the people watching over you and your family are aligned with yours. We understand your desire to take care of your family, community and ministries dear to your heart. Covenant Trust Company was established to facilitate that generosity. Ann Wiesbrock, CFP President Covenant Trust Company Everyone needs a financial services partner. We would like to be yours. CTC provides the expertise, discipline and clear-eyed focus on long term results you expect in an asset manager. We are committed to excellence, integrity, and prudent investing, looking to grow your net worth over time. We take care of business so that you are free to take care of what matters most to you. Growing Your Ministry through Endowment Covenant Trust Company Endowment Services

17 It s all about the future 2015 Covenant Trust Company All rights reserved

18 Covenant Endowment Trust The Covenant Endowment Trust was established to accept gi s of cash or appreciated assets into individual Endowment Accounts earmarked for the Covenant ministry of your choice. A gi to the Covenant Endowment Trust will benefit the designated ministry for years to come. Who can set up an Endowment Account? Anyone an individual, family, or any Covenant ministry. Can I/we name the Endowment Account? Yes. You can name an Endowment Account for your family, your church, or a special individual. Is there a minimum contribu on? You can start your Endowment Account with as li le as $5,000. Then you or other friends and members of your family or church can add to the account as you wish, in amounts of at least $1,000. How does the Endowment Account work? The account assets are invested for growth with the objec ve of providing increased future income. A quarterly distribu on (currently at a 5% annualized rate) is made to the designated Covenant ministry. The distribu ons are normally made from income. If income falls below 5%, principal is added to make the distribu on. Any income in excess of 5% is added to the invested account principal to provide a larger base for future earnings. Do I have to fund the account now? No. You can set up the account now, and fund it with a bequest from your will, or designate it as the beneficiary of an insurance policy, IRA, pension plan, trust or annuity. What is the advantage of the Covenant Endowment Trust? The wri en agreement which sets forth your wishes for the use of your gi remains on file, providing both con nuity and assurance that your gi will always be used for its intended purpose. As Trustee, Covenant Trust Company provides professional management and investment services which may not be available or affordable to the local ministry.

19 Are gi s to the Covenant Endowment Trust tax deduc ble? Yes. Gi s to the Covenant Endowment Trust are irrevocable, so they qualify for a charitable contribu on deduc on on federal income tax. How long will the Endowment Account last? You can designate your account to be established in perpetuity (forever) or for a term of years, a er which the principal is distributed to your chosen Covenant ministry. I want to help send kids to camp, but our church doesn't have many who want to go. Can I help other kids go to camp? We'd like to help provide steady income for one of our favorite mission projects. How can we do that? I know our church would like to provide con nuing educa on opportuni es for our pastor, but we just don't have the money. How can I start a fund that will grow? We'd like to make a gi to help our church youth with college or seminary expenses at North Park. But with our church s boards and officers changing every couple of years, how can we be sure our gi will be used the way we intend? If you have ques ons like these, the Covenant Endowment Trust may be the answer you have been looking for. A Covenant Endowment Trust Account can do any of the things listed above, both now and for the future. Exactly how does it work? Call or e mail info@covenanttrust.com to request further informa on; OR visit our website at CovenantTrust.com Information contained in this brochure is for purposes of information and education only, and is not intended as either tax or legal advice. Consult your personal tax and/ or legal advisor for specific information. Investment Management Trustee Services IRAs and Re rement Inves ng Endowments Legacy and Gi Planning

20 BEQUESTS to COVENANT MINISTRIES through your LEGACY PLAN People who have been regular contributors during their lifetimes usually want to include the causes they care about in their legacy plan. It is important to include the following information in any bequest to a Covenant ministry: The dollar amount or percentage of the bequest. A specific dollar amount may be used; but if the estate is not large enough to cover that amount, the charity will get nothing. A percentage designates a portion of whatever remains in the estate. The resulting dollar amount may move up or down depending on the estate size; but the donor s desire to make a bequest is fulfilled. The correct legal name of the ministry and its location, e.g. The Evangelical Covenant Church, an Illinois not-for-profit corporation, 8303 West Higgins Road, Chicago IL. The right name is important. You must provide enough information so the ministry can be readily identified and located. Any designation or specific instructions for use of the bequest. Include a default provision to say what happens if the bequest cannot be used as you originally intended. UNDESIGNATED BEQUESTS Five thousand dollars [$5,000.00] to the Evangelical Covenant Church, 8303 West Higgins Road, Chicago, IL Fifteen percent [15%] to First Covenant Church, 300 North Main Street, Mt. Prospect IL DESIGNATED BEQUESTS Ten percent [10%] to the Northeast Conference of the Evangelical Covenant Church, 1492 Chestnut, Stowe, CT for its camping program at Camp Goodtimes Bible Camp Ten thousand dollars[$10,000.00] to North Park University, 3225 West Foster, Chicago IL to establish the John and Mary Jones Scholarship Fund for students majoring in education This information is for example only and is not intended as legal advice. You should always consult your personal legal advisor.

21 Creative Giving Most of us have a favorite ministry we want to support that ministry s goals are important to us and we o en look for ways to help them grow. Covenant Trust Company (CTC) believes that investments, including IRAs, are a vital part to everyone s financial security; we also believe they can play an important role in reaching charitable goals, too. Covenant Trust Company offers several charitable gi planning op ons such as Charitable Gi Annui es and Charitable Remainder Unitrusts. However, if these op ons aren t right for you, there are ways to ensure your charitable dreams will provide the greatest impact. We will consider two op ons in this brochure: dona ng appreciated assets naming a charity as a beneficiary I would like to use appreciated assets to donate to a Covenant ministry. What about capital gains? If you donate the appreciated assets directly to a Covenant ministry, you will avoid the capital gains tax. The ministry, due to their tax exempt status, won t have to pay any taxes when they sell the assets. Addi onally, if the appreciated assets have been held long term (i.e., longer than one year), the assets value on the day of the dona on can be claimed as a tax deduc on. (The deduc on for assets held less than a year is equal to the assets purchase price). I have assets that are worth less than I paid for them. Can I s ll use them to help a ministry? If you have assets that are worth less than what you paid for them, you can sell the assets instead of dona ng them. By selling the assets at a loss instead of dona ng them directly to the ministry, you will be able to claim the loss on your taxes. Doing so may reduce your taxable income which in turn may mean a lower tax bill. You can s ll donate the proceeds from the sale to a Covenant ministry and receive a charitable tax deduc on as you normally would from giving a cash gi. How can Covenant Trust help? CTC is happy to facilitate your gi to your favorite Covenant ministry. CTC will take delivery of the donated security on behalf of the Evangelical Covenant Church, and upon receipt of the stock, will sell the shares. Upon receipt of the proceeds of that sale, we will send a check to the ministry along with a le er indica ng the check is proceeds from a stock gi from you. To begin this process, contact Mike Magnusson at Covenant Trust Company: or mkmagnusson@covenan rust.com.

22 Why should I consider naming a charity as beneficiary of my IRA? When you name one or more chari es as the beneficiary of your IRA (or Qualified Plans) the charity(ies) pay no income tax when they receive distribu on of the assets. If you name your spouse or other individuals as beneficiary, the income tax will have to be paid, unless they in turn name one or more chari es to receive the assets at their death. If they do not name any chari es, then their estate or non charitable beneficiaries will have to pay the income tax. I have a life insurance policy I no longer need. Can I use it to benefit a favorite ministry? A gi of your life insurance is an excellent way to make a gi to a Covenant ministry. There are two ways to do this. Make a gi of life insurance today By giving your life insurance policy to a Covenant ministry today you ll receive a charitable income tax deduc on. You can then make deduc ble contribu ons to this ministry each year which they may use to pay the premiums. The ministry then benefits from the proceeds of your policy. Designate a ministry as beneficiary of your policy You can also designate your favorite Covenant ministry as the beneficiary of your life insurance policy. You will con nue to own and can make use of the policy during your life me. The policy will be included in your taxable estate when you pass away, but your estate will benefit from an estate tax charitable deduc on for the value of the gi. For more informa on, contact Covenant Trust at or covenan rust.com/info. What s the measurement of success in the partnership between your ministry and Covenant Trust Company? The growth of future charitable dollars designated for your ministry The growth of ministry dollars that you entrust to us for management Your ability to advance your ministry and achieve your ministry s goals Peace of mind for both your ministry and your supporters about their legacy for the future We re in this Kingdom work together. Covenant Trust Company is a unique resource for your ministry that puts financial management tools right at your finger ps. And isn t it nice to know that everything we do has its founda on in stewardship; managing the resources God has given in a way that will honor Him and help do His work. Information contained in this brochure is for purposes of information and education only, and is not intended as either tax or legal advice. Consult your personal tax and/ or legal advisor for specific information. Investment Management Trustee Services IRAs and Re rement Inves ng Endowments Legacy and Gi Planning

23 In It Together Your ministry is many things to many people. There are a lot of moving parts, and all of them need resources. And you have a long list of things you d like to do if only you could. You ve learned that you can t do it on your own. You need staff, supporters and facili es. You need prayer, willing hands, and caring hearts. You also need external resources those with exper se you may not have. You need a plan for your ministry that includes both short term and long term goals, and con ngency plans for the unexpected. And you need funds cash to pay the bills, to fund the programs of your ministry, to ensure the future of what you do for God s people. Covenant Trust Company is your partner in ministry. We ll work with you: to strengthen the resources you already have to generate and manage new resources for the future to be a good steward of your ministry s resources as part of its legacy for tomorrow Your ministry s goals are important to us. As your partner, we can help you achieve your mission goals. What value does Covenant Trust Company bring to your ministry and its supporters? Our partnership can generate more future charitable dollars for your ministry. Our professional asset management can preserve and grow current ministry investments. Our educa onal presenta ons help supporters understand how to use legacy gi s to benefit your ministry beyond their life me. Other available presenta ons cover a wide range of addi onal finance related topics. Our partnership brings a full service financial resource right to your door. CovenantTrust.com is the gateway to planning tools for your ministry, your staff and your supporters in money management, re rement planning, charitable giving and much more. Our partnership provides the peace of mind that comes from knowing plans are in place to achieve the goals you have established.

24 Covenant Trust Company is your partner in ministry. We want to be the provider of choice for financial resources for your ministry, your staff and your supporters. What makes us a worthy partner? Our history 2014 marked 25 years since Covenant Trust Company was established. The same services were provided for the ten years before that by Covenant Estate Planning Services, giving us a total of 35 years of partnership with Covenant ministries Our results $700 million currently under management $213 million distributed to Covenant ministries and now at work for the Kingdom Over $237 million of known future dollars earmarked for all Covenant ministries Our mission To awaken people to the significance of stewardship through legacy planning and financial management What s the measurement of success in the partnership between your ministry and Covenant Trust Company? The growth of future charitable dollars designated for your ministry The growth of ministry dollars that you entrust to us for management Your ability to advance your ministry and achieve your ministry s goals Peace of mind for both your ministry and your supporters about their legacy for the future We re in this Kingdom work together. Covenant Trust Company is a unique resource for your ministry that puts financial management tools right at your finger ps. And isn t it nice to know that everything we do has its founda on in stewardship; managing the resources God has given in a way that will honor Him and help do His work. Information contained in this brochure is for purposes of information and education only, and is not intended as either tax or legal advice. Consult your personal tax and/ or legal advisor for specific information. Investment Management Trustee Services IRAs and Re rement Inves ng Endowments Legacy and Gi Planning