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(Part of a series of articles on charitable giving and the Union County Foundation by David Vollrath - Exec. Dir.) There is no better time than the beginning of a new year to give yourself an investment checkup. 2003 was an unusually good period for the stock market following several dismal years. Many investors who were able to wait out the previous downturn have found that their patience has finally been rewarded. Considering all the volatility of recent years this might be a very good time to evaluate your investments. Investments include your money market funds, certificates of deposit, stocks, mutual funds, bonds, and other assets. Why is January such a desirable time to review your investments? First, many of your investments have increased in value enough to have recovered the losses incurred previously. It might be a good time to consider further diversification by selling some of these investments. Second by taking a good look at your investments you may determine that they are not providing the income that you originally expected. For example many certificates of deposit are now earning less than 2% and many money market funds yield even less. Even in present times of low inflation these are not very desirable returns. What are some reasonable options for those who would like to increase their income? One alternative to consider would be the purchase of highly rated dividend yielding stocks. Such stocks might pay dividends of 4%, 5%, or even more. With recent tax code changes stock dividends are now taxed at a maximum rate of 15% (same rate as capital gains) rather than previous ordinary income rates as high as 35%. Another alternative for investors who are reluctant to make large investments in stocks might be to consider a charitable gift annuity. Gift annuity rates can be 6%-10% depending on your present age. A charitable gift annuity allows you a significant initial charitable deduction, provides fixed lifetime income at desirable interest rates, and allows you to leave a financial legacy to your favorite local charitable organization(s) upon your death. Charitable gift annuities can help you raise the average return on your portfolio to levels more in line with your goals and expectations. The Union County Foundation is equipped to help you achieve your charitable goals by providing pertinent information and assisting you with planned giving. Please call us at 937-642-9618, email commfounduc@imetweb.net, reference our website at www.emarysville.com/unioncountyfoundation, or stop by our Marysville office at 126 N. Main St. We are committed to helping you.... “preserve your footprint in time.” |
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