From the Blog: Beware CGA Rate Shoppers

The rate to be offered to your interested donor, per your organization’s policies, is 6.5%. So what do you do if your donor asks if you can go a little higher, maybe a rate of 6.8%? And then lets you know that another charity is willing to offer that? How do you suppress the urge to waive your policy in order to not “lose” the gift, particularly since these situations often arise in the context of an exceptionally large contribution amount – which is precisely when you don’t want to increase the risk to your organization?

To help stamp out the urge to participate in rate shopping, it helps to understand how policy decisions affect your program, and the impact bumping up your rates can have on its success.

Read the blog post . . .

Monitoring CGA Reserve Balances

The volatility and uncertainty of market conditions during 2022 highlights the importance of regularly reviewing your gift annuity reserve balances in relation to state reserve requirements. Such reviews are always a best practice, certainly ahead of any state reporting period end but also during the course of the year – how frequent may be dictated by the level of activity in your program (new and terminated gifts) as well as investment returns.

Within GiftWrap you can run a reserve calculation at any time for any date. For example, if you’ll be filing a 2022 annual report to New York, you can run a New York-methodology reserve calculation today and specify the “valuation date” as 12/31/22. Be sure to select the applicable surplus so it will be added to the total, giving you a full picture of your reserve obligation. Of course, any report run in advance of the actual valuation date can only calculate the reserve based on annuities in existence at the time the report is generated; the reserve amount will change if you issue additional annuities or have annuities terminate between then and the valuation date.

Reviewing your gift annuity reserves in advance of required reporting deadlines will either provide assurance that the reserve remains adequately funded or allow time for any needed adjustments to be made should it be underfunded. Proactively infusing money into the reserve account before the reporting period end puts your organization in a much better position with state regulators than reacting to an underfunded situation after the period end. Having inadequate reserves could result in suspension of your permit (thus being unable to issue new annuities in the applicable state) and/or a fine. It can also flag your organization for increased scrutiny going forward . . . certainly attention that no organization wants.

Need more help? PG Calc offers gift annuity risk assessments, or you can have us manage all your compliance reporting, so you can focus on fundraising.

PG Calc Training in 2023 - You Spoke, We Listened

We recently conducted a survey of past training attendees to clarify preferences for in-person and online training sessions. Prior to the COVID pandemic, nearly all of our training sessions were in-person. During the height of the pandemic, we switched to providing training only through online sessions. Now that we are emerging from the pandemic – albeit in fits and starts – we are offering a combination of online and in-person sessions.

The results of our survey were interesting, but not completely surprising: PG Calc clients continue to value our training offerings, and they wish to have both online and in-person sessions. Generally, there seems to be more support for online sessions, but there is still significant interest in the traditional classroom-style offerings. Based on these findings, we have put together a training schedule for the first six months of 2023, which promises something for everyone! These classes are available for registration on our website. 

PG Calc Webinars for 2023 Will Feature Format Changes and Reduced Cost

We will be making some significant changes to our monthly webinars for 2023 that we think you will like.

1. Reduced Length: Webinars will last no more than 60 minutes, versus the current 90 minutes.
2. New Format: Eight standard webinars: 45-minute presentation + 15 minutes for Q&A. Four Q&A webinars: 60 minutes of Q&A on a specified topic.
3. Reduced Cost: The eight standard webinars will be just $45 each. The four Q&A webinars will be FREE. Costs for recordings and series subscriptions also will be greatly reduced.

We are close to finalizing all the topics, dates, and presenters for 2023. In addition to presentations from PG Calc experts, Professor Russell James will be sharing his provocative insights on the use of metrics in gift planning; Karen Johnson, Senior Director, Complex Gifts at Harvard University, will discuss gifts of unusual assets; and Beth Ridout, Director of Estate Administration at The Nature Conservancy, will be answering your questions about bequest administration.

We expect to have our webinar schedule for 2023 finalized within the next week or two. We will be in touch with all the details soon after that. We hope you will join us for all our 2023 webinars!

Most New York Maximum Annuity Rates Remain Higher than ACGA Rates in Q4 2022

There is good news for charities that issue annuities in New York this calendar quarter! New York’s maximum single-life annuity rates for Q4 2022 remain higher than the corresponding ACGA rates for all male and female ages. Our testing of a range of joint-life annuities suggests the same is true for joint-life annuity rates. The story remains less rosy for deferred gift annuities. There still are some one-life and two-life deferred annuities where New York’s maximum rate is lower than the ACGA rate.

If you are working with a New York donor who wishes to fund a two-life immediate gift annuity, or a one-life or two-life deferred gift annuity, contact us. We will determine the maximum annuity rate New York will allow you to offer your donor. Learn more about our New York Rate Calculations Service and submit a calculation request form.

For more details read the blog post . . .

CGA Manual Updated for 2022

We have completed our 2022 update of Charitable Gift Annuities: The Complete Resource Manual. The CGA Manual is our go-to resource for answering all your questions about operating a gift annuity program and handling the details of specific gift situations. This year’s update includes:

• A discussion of the new 2010CM mortality table,
• Suggestions for marketing gift annuities after the recent increase in ACGA rates,
• The tax implications of gifts of life insurance after Rev. Rul. 2020-5,
• Results from the 2021 ACGA gift annuity survey, and
• Hundreds of other timely revisions.

The manual is available in electronic and hardcopy formats. We will send the electronic version to electronic and print/electronic bundle subscribers within the next few days. The updated hardcopy will be sent to all print subscribers within the next two weeks.

Learn more about the CGA Manual and order your own copy.

Pop by Our CGP National Conference Booth in Reno

We look forward to seeing you at the Charitable Gift Planners National Conference in Reno, NV on October 26-28. We'd like to tell you what our giveaway is this year, but you'll have to see for yourself.

Come say hello between sessions, and don't miss PG Calc Senior Advisor Craig Wruck's pre-conference program "Gift Planning Fundamentals: Tools & Techniques."

What Can We Do for Brown? Help Start Donor Conversations with a Donor Survey 

“Working with Andrew [Palmer] and PG Calc on our survey was an enjoyable and rewarding process. We were able to customize the questions for our tone and brand. The survey continues to return on its value with new legacy society members and gift conversations.”

—Rebecca Zuck
Director of Planned Giving
Brown University

Learn more about Brown University.

Learn about PG Calc Marketing Services, including donor surveys.