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Faith-Based Planning

Faith-Based Endowment Plans

Faith-Based Endowment Plans

The establishment of a church endowment plan is a way for individuals to declare to present and future generations the importance of their faith and trust in God and their desire to perpetuate the well-being of the church during and beyond their lifetime. By making gifts during or after your lifetime, you are providing continual financial support to the church so that your children, grandchildren and others that you care about may continue to enjoy a strong and vibrant faith community. The primary purpose for establishing an endowment is to help sustain the long term financial stability to the church. Funds distributed from the earnings of the endowment can be used to offset a portion of the church's operational expenses or address the long term spiritual and economic needs of its members.

Administration and Investment of Endowment Funds

 It is recommended that the church create an endowment fund committee, use a charitable foundation or some other form of governing body to administer the endowment fund. Some of the key duties and responsibilities of those selected to govern the fund will include establishing an investment policy statement, setting asset allocation guidelines, selecting investment managers, monitoring investment performance, determining appropriate payout ratio and annual reporting. *The church will also need to engage a tax consultant to ensure proper valuations are given when donation letters are requested by individuals desiring to donate real estate such as homes or investment property and seeking a tax write-off.

Funding the Endowment

The endowment can be funded in a variety of ways to include:

  • Real Estate
  • Appreciated stocks, Bonds or Mutual Funds
  • Life Insurance
  • Life Income Agreements using Charitable Remainder or Charitable Lead Trust
  • Cash

*Efinancial Advisors and LPL does not provide legal or tax advice.