Questions and Answers
What is an endowment fund?
An endowment fund is an investment fund established to enhance the ministries of the church beyond the general operating budget. A gift to the endowment fund extends into the future, because the principal remains intact to produce income for years to come.
Why does Word of Peace need an endowment fund?
An endowment fund provides a viable and secure future for Word of Peace and its mission by the distribution of interest income for Scholarships, Ministry, Outreach and other designated projects. Funding these kinds of creative ministry opportunities are outside the General Fund or Building Fund focus. Leaving a legacy for future generations at Word of Peace, through an endowment contribution, is one way to support the mission “To know Christ and make Christ known to all people.”
What are the benefits of giving to the fund?
Gifts to the endowment fund can offer financial benefits such as a tax deduction, reduction of estate taxes and avoiding capital gains tax. In addition, you will be leaving a legacy to Word of Peace that will continue during your lifetime and beyond. What a testament to our faith, and our thankfulness for gifts He has given us!
How does my Endowment Fund gift differ from my annual giving?
General and Building Funds serve the Churchʼs day to day needs. Your Endowment Fund gift, when combined with that of others, can help fund ministry opportunities that are outside the day to day operational needs and are long term in nature. Assisting with Seminary or Church Worker Education, providing startup funding for a Parish Nurse, funding a Mission Project, assisting with a large deferred maintenance item, or helping with a major outreach plan to reach unchurched people in the area, are just a few of the creative possibilities that could be explored. Disbursements from the Endowment Fund are made annually to applicants based on what the long range result will be for Word of Peace.
What types of gifts can I give?
Cash donations are far from the only way to make a gift to the Endowment Fund. There are many ways to donate in order to mutually benefit you and the church. You may gift the following items:
Stocks, mutual funds, bonds, real estate and property: Whether your assets have appreciated or depreciated, a donation will benefit you at tax time. An appreciated asset will let you avoid capital gains tax, where a depreciated asset lets you take advantage of both the loss and the charitable contribution on your taxes.
Bequests by will or trust: If you are over 65 and reluctant to give assets that may generate earnings during your retirement years, a bequest by will or trust can give a great sense of satisfaction. This is the most common way to gift the endowment fund.
Charitable lead trust: This trust allows the donor to benefit the church during the time of the trust, and thereafter, pass the principal to family members with little or no taxes owed.
Charitable gift annuity: With a CRT, in addition to a tax deduction, you will receive a regular fixed sum of money in exchange for your donation.
IRAs, 401Ks, profit sharing: These assets can be subject to both income and estate taxes at death. Designating the church as beneficiary can avoid all taxes and maximize the value of the asset.
Life insurance: Make a gift of a current policy, or purchase a policy with the church as beneficiary.
Income-only gift, flexible endowment or market-based pledge: If you are hesitant to give a gift during an unsure economic climate, these options may appeal to you.
Cash: Cash can always be donated on a one-time or periodic basis.
Can I decide how my gift is used?
Yes, you may choose how your gift is used if you desire. There are currently five separate funds to choose from when making your gift. These include, but are not limited to, areas such as ministry, scholarship and outreach missions.
Who manages the Endowment Fund?
The Endowment Fund is managed by a committee of Word of Peace members and staff. They are committed to faithfully and confidentially serving you and the church.