Recognizing a unique way to combine her charitable goals with her retirement planning, Kim Mitchell established a $50,000 deferred charitable gift annuity with the National Trust for Historic Preservation.
History is personal to Kim Mitchell, a pioneer in her own right as one of the first female students admitted to the University of Notre Dame. In fact, she cares deeply for places that tell America's story.
"It's important to understand how we got to where we are," Kim reflects. "It's easier to do that when you can put history in context, whether walking the fields of Gettysburg or going through an old home to see how people once lived."
Finding time to visit historic places was always challenging for Kim given her demanding, 30-year career in law. That is one of the reasons it was important to her to retire early. And while taking a well-deserved break was the ultimate goal, giving back remained a strong priority.
"Twelve years ago, I sat down and said, 'okay, I need to put together a will,'" Kim remembers. "I made the decision that I wanted to give a substantial portion of my estate to charities, but I was unsatisfied that the charities would only benefit after my death, when I wouldn't be around to enjoy the good my gifts might do. And who knows how much is going to be left when I die? If all goes great for me, there won't be much left over."
Kim considered establishing a charitable gift annuity, but it was not a perfect fit. She had two competing interests; she wanted the current tax deduction because she was ready to retire and stood to enjoy some final payouts which would bump up her income level. At the same time, she did not need income payments just yet and did not want to get locked into lower annuity rates because she was under 60 years of age.
That's when she read about the option of a deferred charitable gift annuity on the trust's website.
"Once I saw this, I thought it was a perfect thing for me to do,'" Kim recalls "I could get a current income tax deduction, but not have to start taking income until sometime in the future. I could achieve my goals from both a charitable and a retirement planning perspective."
Recognizing that she was a lawyer and not an investment advisor, Kim saw another advantage in having the money professionally managed. She also liked the idea that if the managers exceeded their target returns, the charities would benefit.
"Hopefully, these charities will be able to accomplish my income goals and better the return so they enjoy the additional income," Kim says.
In the current economic climate and the uncertainty about future taxes and permissible deductions, her timing also proved advantageous. As Kim reasoned, "depending on what happens with tax law changes, for highly compensated individuals, tax deductions may start to be whittled away. I wish now I had used this vehicle during my working years."
Furthering her love of history and accomplishing her retirement goals, Kim established a deferred charitable gift annuity with the National Trust. Her $50,000 gift this year will guarantee her $3,000 a year for the rest of her life starting in 2020, some of which is tax free. She will be able to claim nearly $14,000 in charitable deductions this year. She was also able to qualify for an additional $5,000 cash matching grant thanks to the Wilson Legacy Challenge.
And with the sound management of the National Trust's investment managers, Kim's gift will continue to grow, ensuring important support for the future of historic preservation.
Today, with her hectic career behind her and her financial future secure, only one question remains: what is Kim looking forward to doing with her free time?
"I want to be a dilettante," Kim jokes. "To do whatever interests me. I'm going to enjoy the outdoors more, read books, take classes. I'm looking forward to spending more time with the charities I have supported. I will have more time to travel, staying in historic hotels. And, maybe get involved at National Parks and historic sites."