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Commonly asked questions about Charitable Gift Annuities

What is a Little Flower Charitable Gift Annuity?

It is a legal contract between a donor and the Society of the Little Flower. The donor makes an unrestricted gift to the Society in exchange for the Society providing the donor with guaranteed fixed payments for the rest of the donor's life.

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Why does the Society offer Charitable Gift Annuities?

It provides our friends with an opportunity to make a significant gift to the Society's St. Therese Endowment Fund. This fund provides for the Seminary education of future Carmelite Priests and Brothers so that they can also unveil God's Love to future generations. At the same time, as an annuitant, you will receive fixed payments for as long as you live. It is our way of being able to help you, as you have helped us for so many years.

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What should be stressed to someone considering a Charitable Gift annuity?

First and foremost, it is a gift. Secondly, Little Flower Gift Annuities are safe, secure, and simple to establish. A Little Flower Gift Annuity also helps address concerns for receiving reliable future checks during your lifetime, while also providing relief from the responsibility of determining the future directions of the stock market, bond market, interest rates, or other investment possibilities.

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What makes Little Flower Gift Annuities safe and secure?

All annuities are secured by a professionally managed reserve account consisting of high-grade investments. This account is continually reviewed to ensure that it always exceeds applicable laws and regulations. In addition, your contract is also backed by all the assets and resources of both the St. Therese Endowment Fund and the Society of the Little Flower. Since the program inception over 50 years ago, the Society has always made every payment on time.

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Are there other benefits of a Little Flower Gift Annuity?

Yes! A portion of each annuity payment you receive during your life expectancy is tax-free, and is not included as part of your total income when determining the percentage of your Social Security benefit which is taxable. In addition, a portion of your gift is tax-deductible in the year you establish the annuity. Also, when you fund your gift annuity with long term appreciated property (stocks, bonds, etc.) the reporting of your capital gain is spread out over your life expectancy. Finally, a Little Flower Gift Annuity allows you to make a gift that will provide a Rate of Return that in most cases is currently higher than interest from certificates of deposit and government bonds.

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What is the minimum age and amount necessary to establish a Gift Annuity?

You must be at least 50 years old at your closest birthday (unless you are interested in a Deferred Annuity), and can establish a Little Flower Gift Annuity for as low as $1,000.

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How does a Gift Annuity work?

To illustrate: if Mrs. Rice, whose closest age is 71, contributes $10,000 to a Little Flower Gift Annuity, she will receive an 7.5% annual Rate of Return. This provides her with $750 every year, for the rest of her life. A portion of this is taxable, with the balance excluded from taxation. Mrs. Rice can establish her Gift Annuity by check, money order, or bank draft, or by transferring ownership of stocks or bonds. The rate of Return is set when the Gift Annuity is established, is fixed for her lifetime, and will not change. Mrs. Rice can elect to receive her annuity payments on an annual, semi-annual, quarterly, or monthly basis, depending upon her needs and the amount of the Gift Annuity.

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May I withdraw my Gift Annuity?

No. Due to the immediate tax benefits, the contract is irrevocable.

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What is a Deferred Annuity?

The gift Annuity is established now, with payments beginning at a specific date in the future (such as your anticipated retirement date, 65th birthday, etc.). The Rate of Return for those annuities are higher, and they also provide a substantial tax-deduction in the year the Gift Annuity is established. As an example: Mrs. Nelson is 45 years old on her closest birthday, and would like to plan for her retirement years. If she decides to fund a Deferred Charitable Gift Annuity with $10,000, she could begin receiving payments in the month of her 65th birthday. In addition, Mrs. Nelson would also receive a significant tax deduction in the year of the gift. She would begin receiving payments in 20 years at the annual rate of 10.7%. This would provide her with $1,070.04 every year, for the rest of her life.

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May I have several Gift Annuities?

Yes! A new contract may be started at any time. New rates, based on your closest birthday at that time, will be issued. This provides you with the opportunity to take advantage of the rates that are available as you get older. You may also establish a Gift Annuity to help someone else; a spouse, child, niece, etc. as long as they meet the minimum age requirement.

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How would a Gift Annuity for both my spouse and myself work?

This is called a Two-Life Joint Annuity. The annuity check is initially made payable to both husband and wife. After the death of either spouse, the amount of the check remains the same, but the check is made payable to only the remaining spouse, and continues for the rest of his/her life. Because it covers two lives, the return is somewhat lower than a one-life annuity, and rates are based on both persons covered.

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Can I arrange for my Gift Annuity to pay a second person after I die?

Yes. This is called a Two-Life Successive Annuity. The annuity check is payable only to the applicant for his/her life. After the applicant dies, the annuity check is then made payable to the second annuitant, and continues for the rest of his/her life. Again, because this covers two lives, the return is somewhat lower than a one-life annuity, with the rate based upon the ages of both persons covered.

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What if I have a question or want to clarify my understanding of Gift Annuities?

You may call us toll-free, 1-888-996-1212 and we will be happy to answer any questions you might have, provide you with sample calculations, or help you with your application. We believe that you should have all the relevant information necessary to make an informed decision. We are here to serve you!

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