Alan and Susan had long been involved in
charitable activities. They were volunteers at many recent annual fund drives,
spending evenings helping with phone calls. The time they have spent together
helping others was intensely rewarding to them and they often wished they could
Susan: "While we get personal satisfaction out of helping
others, there is also some frustration. No matter what we do, there is always
more that could be done."
Alan: "It would be wonderful to be able
to not only physically pitch in, but also be able to just write a check or set
up a trust or create a foundation to solve all these problems. But that's not
who we are. We're just everyday folks, not wealthy or rich."
Susan: "One day we were talking with a development officer who was saying they had just
received a major gift, thousands of dollars, through a trust some people had set
up. I said, 'boy, I wish I could do that but the legal fees and setup costs would
about wipe out what we could give.' He looked to see if I was serious and then
said there is a way, called a pooled income fund."
Alan: "So we
looked at the literature and then talked some more about it. And he was right,
we could do it. We may not be rich, but the feeling we get from knowing what we
can do makes us feel rich."
A Pooled Income Fund, often called "the mutual
fund of charitable giving," is one trust for many donors, rather than one trust
for an individual donor. When a donor makes an irrevocable gift to the Saint Joseph's
College Pooled Income Fund to benefit Saint Joseph's College, the donor joins
a "pool" of other donors who commingle their donations (it is an irrevocable gift)
in a pool of investments that is governed by a trust document that the charity
establishes. Each donor has a proportionate share in the fund.
With a Pooled
Income Fund, it is not necessary to create a new trust each time a gift is made.
As a result, new contributions (cash and or appreciated securities) can be made.
The proportionate share of the fund's annual income is paid to each donor. On
the death of the donor or the last income beneficiary, the percentage of the pooled
income fund representing the donor's gift is withdrawn by the charity for its
A pooled income fund is an excellent way to make periodic contributions
that will build into a sizable gift while avoiding fees and setup complexities.
Using appreciated securities as a gift to a pooled income fund enables avoidance
of capital gains taxes and the donor receives a charitable deduction for the gift
value. The pooled income fund will provide income that will vary based on investment
Return to planned giving home.
For more information or a confidential discussion of your charitable options, please email or call the Vice President and Chief Advancement Officer, Joanne Bean, at 207-893-7891.
Please note, individual financial circumstances
will vary. The information on this site does not constitute legal or tax advice, either in whole or in part. Donor stories and photographs are for purposes of illustration
only. As with all tax and estate planning, please consult your attorney
or estate specialist. All material is copyrighted and is for viewing purposes
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