Giving a Gift and Getting a Return

By JAN M. ROSEN
Published: November 10, 2010 in NYTimes

FOR retirees increasingly worried as interest rates on their savings accounts and money market funds have plunged below 1 percent, an appeal from their alma mater or a respected charity, offering a return of 5 percent or more on a charitable gift annuity, can seem like a rare opportunity.

Is it? Or is there a catch? The answer to both questions is no. But the questions are simplistic.

Better to ask yourself: “Do I want to support the charity?” and “Is a gift annuity a wise choice for me?” If you answer the first one with a yes, then you need to assess your finances and understand what charitable gift annuities are and how they work.

“Some people assume it’s like a bank account,” said Avery E. Neumark, a retirement specialist and partner in the New York accounting firm Rosen Seymour Shapss Martin & Company. “But it’s not. It is just what the name says — a gift. You give away the principal, and you get a guaranteed lifetime income. You can’t compare that with today’s money market rates. The downside is you are locked in.”

The rates, which far exceed today’s annual 1.1 percent inflation rate, might seem low years from now if inflation heats up.

For the choice to be a wise one, Mr. Neumark said, people should generally be nearing retirement and charitably inclined, have liquid assets and other income and have taken care of other needs. “I had one client who did very well,” he said. “He was 90 years old, so the rate was very high, and he lived until he was 103.”

The American Council on Gift Annuities defines the product as a contract under which a charity, in return for a gift of cash or property, agrees to pay a fixed amount over the term of either one or two lives, usually the donors’. Most reputable charities use rates recommended by the council, which vary with the annuitants’ ages and whether there are one or two. Because of the charity, there are tax benefits.

For a single life, the latest rate table called for a 55-year-old to receive 5 percent a year, a 60-year-old 5.2 percent, a 65-year-old 5.5 percent, a 70-year-old 5.8 percent, an 80-year-old 7.2 percent and someone 90 or older 9.5 percent.

Prospective donors can calculate their own rates and tax benefits at the Web site: pcalc.ptec.com/hosts/989357365/CGA. For a $100,000 gift annuity covering one person aged 65 and another aged 62, the site calculator showed an immediate tax deduction of $12,179.50 and an annual annuity payment of $5,000. Of the latter, $3,326.53 would be tax-free because it represented a return of principal and $1,673.47 would be taxed as ordinary income.

After 26.4 years, their joint life expectancy, all payments would be taxable as ordinary income.

Conrad Teitell, a lawyer in Stamford, Conn., who represents the council and a number of large charities, said donors could donate appreciated assets and avoid immediate payment of capital gains tax. The gain is prorated annually over the donor’s life expectancy, and the taxable portion of the annuity payments is divided into ordinary income and capital gains.

Donors do not have to begin taking annuity payments immediately, he said; they can defer payments for a year or more. That can be a good option for people who are employed and in a high tax bracket, but who expect to retire in a year or so.

Some states require charities to meet criteria, including initial registration, notification and annual filing, to sponsor charitable gift annuities. Others are silent. Many are somewhere in between. Mr. Teitell advised prospective donors to check on their own states at the American Council on Gift Annuities Web site (www.acga-web.org/regs/regsoverview.html).

If one’s home state does not require charities to meet any criteria, see whether a charity is authorized to offer annuities in a stricter state, and check its financial soundness at the Better Business Bureau (www.bbb.org/us/charity) and Charity Navigator (www.CharityNavigator.org).

A sound approach is not to become involved with a charity that does not meet the standards of a tougher state, because annuity payments are a general obligation of the charity. Though failure to meet the obligation is rare, some charities take out reinsurance, a matter worth discussing with a prospective recipient.

Paul Horrocks, vice president of the New York Life Insurance Company, which sells individual annuity policies and also works with charities on gift annuities, said donors could “accomplish the same thing in two ways,” either through a charitable gift annuity that might pay 5 percent or by dividing the amount into an outright gift to the charity and a commercial annuity that would pay about 7 percent.

Don Greene, national philanthropic product executive for Bank of America Merrill Lynch, favors charitable gift annuities. They are a way for “lower-end donors” to enter the world of “structured philanthropy,” he said, and “they offer tax advantages and a consistent level of support for a spouse.”

The gift is irrevocable, he added, but a person who is committed to charity, by including a bequest in her will, for example, might want to consider a gift annuity instead and enjoy making the gift during her life.

Please call Turkish Philanthropy Funds at 646.530.8988 if you would like to learn more about Gift Annuities and Other Planned Giving Options or visit our website for more information.

Innovation Philanthropy: Mobilizing Turkey's International Brain Power

Posted by Dr. Banu Onaral

Since 1950’s, Turkey, along with other developing countries focused on educating scientists, engineers and business professionals to spark economic growth and unleash ‘innovation ecosystems’. It was a miscalculation. Turkey created a ‘brain power’ for which its economic system was unprepared. This prompted a ‘brain drain,’ exporting its best and brightest to the West, which offered opportunities to match their skills.

This has been changing in recent years. With an estimated 30 000 to 40 000 of its scholars, scientists, engineers, medical doctors and high ranking professionals and executives living outside its borders, Turkey is starting to realize the power and the importance of its own international ‘brain network.’ Organizations such as Turkish Philanthropy Funds have started to build these networks by building bridges between those abroad and their compatriots at home. They are helping accelerate Turkey's social and economic development through transnational ‘innovation partnerships.’ It is a phenomenon that has come be called ‘innovation philanthropy.’

Also referred to as "philanthropy to build social capital," innovation philanthropy is centered on knowledge, science and technology-based social and economic development. It is founded on mutual respect and understanding gained through shared mission and equal partnership between the philanthropists and the private, public, academic and civil society sectors.

Innovation philanthropists are those who donate professional expertise, contribute strategies, share their experiences and material resources to enable their local counterparts to take charge in science and technology based initiatives. It’s ‘philanthropy through solutions,’ focusing on addressing the unmet needs of a developing society. Innovation philanthropy does not impose, rather partners to identify, to assess, to connect, to leverage the existing resources that may not yet be integrated and fills the gaps.

INOVIZ: Izmir for Health Initiative is an example of innovation philanthropy. Since March 2009, INOVIZ has mobilized human and physical resources in life sciences, biomedical technology and healthcare services so that Izmir, Turkey’s 3rdlargest city, can brand itself as a health center. The initiative has facilitated more than ten meetings, workshops and conferences and culminated in the Global INOVIZ Conference, held on May 24-25, 2010 with regional, national and international participants. Turkish ex-pats are showing interest and Izmir’s goal of becoming a health center is progressing.

INOVIZ demonstrates the importance of platforms. Change cannot happen without space and room to grow. INOVIZ provides that space, convenes the community and builds trust among sectors of the society. The trust deficit is ultimately the most challenging for the developing world. INOVIZ is a regional innovation model that helps turn the country’s ‘brain drain’ into a ‘brain gain.’ Transnational ‘innovation philanthropists’ are currently contributing to similar initiatives in Ankara, Eskisehir, Istanbul as well as other cities, each emerging from the realities of the locality to address their unmet needs as they become part of the innovation economy. This is how ‘innovation ecosystems will ultimately thrive.

Dr. Banu Onaral is H. H. Sun Professor of Biomedical Engineering and Electrical Engineering at Drexel University, Philadelphia, PA. She holds a Ph.D. in Biomedical Engineering from the University of Pennsylvania and BSEE and MSEE in Electrical Engineering from Bogazici University. Dr. Onaral’s translational research efforts for rapid commercialization of biomedical technologies developed Translational Research in Biomedical Technologies program, which brings together academic technology developers with entrepreneurs, regional economic development agencies, as well as local legal, business, and investment communities. Dr. Onaral serves on the Engineering Advisory Board of National Science Foundation's and on the board of trustees of Sabanci University. Read more.

Visit TPF website.

Recent Changes to Turkish Constitution Present Opportunity for Gender Equality Advancement

Posted by Lou Anne King Jensen

A majority of Turkish voters recently approved a referendum to amend the Turkish constitution. These accepted changes bring Turkey further in line with EU standards, including equality before the law. The modification regarding gender equality ensures that measures can be implemented that will increase the participation of women in the social, economic, and political spheres. Many women’s groups are now hoping that the government will actually institute such actions.  

The inclusion of women into public spaces is imperative since gender disparities remain high in Turkey. Large numbers of Turkish women are illiterate, many do not participate in the labor force, and their representation in politics is low. While illiteracy rates for women have decreased from 33.9% to 19.6% since the 1990s overall, illiteracy rates continue to be much higher for women in the southeastern part of the country. Women’s labor participation has declined from 34.3% in 1988 to 22% in 2008, in sharp contrast to other countries of the Organization for Economic Cooperation and Development (OECD), while 97.2% of all employers in the country are male. Political representation of women in parliament increased to 9.1% of the total seats in 2007. However, in 2009 only 0.9% of mayors (27 out of 2948) were women. Causes cited for these discrepancies include inadequate education, cultural traditions, childcare issues, limited knowledge of political processes, funding deficiencies, women’s lack of confidence, and a shortage of advancement opportunities.*

Despite these challenges, philanthropic foundations and individual philanthropists can take actions to ensure progress continues to be made regarding the inclusion of women. Fields that need to be supported include the following:

•  research that advances knowledge regarding gender equality;
• innovative programs that educate and encourage women;
• opportunities for the facilitation of linkages between local, national, and international women’s organizations that can provide access to new models, best practices, and serve as support networks;
• efforts to strengthen funding for women’s initiatives; and
• policy reform endeavors.

There are many excellent organizations working to support women in a variety of areas in Turkey. Some of my favorites include the following:

• KAMER Foundation; 
• Turkish Philanthropy Funds - Gender Equality selections; and
• Women for Women’s Human Rights - New Ways.

The approval of the referendum presents all of us with the opportunity to renew our efforts on behalf of women. While many women’s groups are calling on the government to put measures into place that will increase the participation of women, each one of us can be a part of the solution now by incorporating the principle of gender inclusion in our businesses, philanthropic efforts, and in the daily choices we make. It is my hope we will all find ways to give meaning to the passage of the gender component of the referendum by fostering positive change on behalf of women each and every day. 

* The statistics and some ideas contained in this section come from Eder, M., (2010). Turkey. In Ellen Lust, The Middle East (pp. 730-760). Washington, DC: CG Press.

Lou Anne King Jensen is a licensed master social worker recognized for independent practice and President of the Chrest Foundation, a private foundation that has been supporting social projects in Turkey since 2001. She also serves as an advisor or board member to a number of philanthropies and non-profit organizations including those related to Turkey, women, diabetes research, and college scholarships for students.    

Visit TPF website.
 

Creating Opportunities for Youth!

Supporters of  Turkish Philanthropy Funds partners, Toplum Gonulluleri Vakfi- TOG (Community Volunteers Foundation of Turkey) and Sabanci University - SU, will be participating in the 32nd Intercontinental Eurasia Marathon this Sunday, October 17th in Istanbul. Both TOG and SU teams are running for a notable cause: to create opportunities for youth to achieve successful futures.

One of the founders and board member of TOG, Ibrahim Betil, will be running in support of their "Valuing Young People" project while  34 Sabanci University faculty, staff, students and supporters will be running to raise funds for their Scholarship Fund.

To support their efforts through TPF please visit their pages at TPF website. Any contributions you make to these organizations  till October 20th will be relayed directly to the mentioned projects.

“Voices Unveiled: Turkish Women Who Dare”

Turkish Philanthropy Funds along with The American Turkish Society presents “Voices Unveiled: Turkish Women Who Dare” tonight at NYIT Auditorium on Broadway.  

Date: October 6, 2010 Time: 6:00 PM-8:30 PM  Location: NYIT Auditorium on Broadway 1871 Broadway (Between 61st and 62nd Streets)

Set in Turkey, Voices Unveiled explores the clash of the East and the West through the lives of three Turkish women – an activist, an artist and a dancer – who struggle to find their own voices in a traditional world. Turkish Women Who Dare is not just the story of three brave Turkish women.  It highlights the obstacles and challenges women in Turkey face -- obstacles and challenges that prevent them from reaching their potential -- obstacles and challenges that must be broken down -- that we must break down. These individuals’ struggles for personal empowerment reflect the challenges faced by women worldwide. Through their stories, the film examines such timely issues as societal change and the intersections between secularism, traditional values, and gender equality. 

 

Women's issues is at the heart of one of the causes TPF addresses. That's why tonight's screening is significant. The goal tonight is not only to raise awareness but also invite you to take action so we can bring women's tenacity, intelligence and creativity to the forefront and encourage them to make profound contributions to our society. Learn more on how you can take action through TPF.

This event is free and open to the public. However, space is limited and RSVP is required. RSVP for tonight's screening here.

Making of the Documentary "Voices Unveiled: Turkish Women Who Dare”

Posted by Binnur Karaevli

Growing up in a progressive family in Istanbul, I was provided with a great education and encouraged to pursue a career by my family.  However, I still felt society’s pressures in how I should behave and act as a woman.  “What would the neighbors think?” is a common worry for a lot of Turkish women no matter how liberated their families might be.  For the privileged, this subtle oppression might be irritating but a larger segment of women’s lives are dictated by the notion of the woman’s purity of reputation and honor.  In many less developed parts of Turkey, “honor” means a woman’s obedience.  “Honor killings,” the practice of murdering women at the hands of their family for transgressions such as extra-marital sex, are still practiced in the impoverished provinces.

As I set out to make the documentary, “Voices Unveiled,” my goal was to discover Turkish women who defied restrictions in the pursuit of their own dreams and thereby convey their stories.  During the filming, I met women from all walks of life but decided to concentrate on the stories of an artist, an activist and a dancer representing a cross section. Belkis (60s), Nur (50s) and Banu (20s), reflected different aspects of my personality. I felt a strong connection to Belkis’ art because her art is rooted in the traditional form of kilim, (Turkish Tapestry) and yet she creates abstract, minimalist and forceful designs that break out of the box and transcend the form. I immediately responded to Nur’s compassionate and diligent efforts on behalf of the less privileged women.  Many taboos concerning “professional dance” still exists in Turkey.  Banu, a champion ballroom dancer, had to fight against her family that did not accept her desire to dance publicly.  She had to continually walk the line between rebelling and reassuring, pressing on while demonstrating that her dancing is a legitimate pursuit. 

As I explored the main problems Turkish women face, I realized that these concerns are not unique to Turkey. Gender inequality, and lack of education, economic freedom, and sexual and bodily rights afflict many women in the Middle East, Africa, Asia and Latin America. In the film, Nur, the activist says, "Democracy is impossible without women being empowered." My goal with "Voices Unveiled" is to communicate to the audience the link between democracy and gender rights in the world.

Binnur Karaevli was born and raised in Istanbul and earned her BFA in Drama from Carnegie-Mellon University and her MFA in Film Production from University of Southern California.  Her films received top prizes from numerous film festivals around the world. She is currently working on a narrative feature film about the Ottoman Harem.  She splits her time between Istanbul and Los Angeles. For more information on the documentary, please visit www.voicesunveiled.com. Binnur Karaevli can be reached by emailing binnur@voicesunveiled.com

TPF along with the American Turkish Society will be holding a screening of "Voices Unveiled: Turkish Women Who Dare" on Wednesday, October 6th. RSVP online.

Please also join Binnur Karaevli and @tphilanthropy for a tweetchat on women's sexual and bodily rights on October 5th at 2PM EST/9PM IST by using the hashtag #genderequality.  

Go to TPF's website.

Illiteracy does not just mean the inability to read or write

“As I would board the bus, I would ask the driver shyly whether the bus was headed in the direction I needed to go. Now, I can read the bus route. I can go wherever I want without asking anyone.”- Emine S.

“I couldn’t go to the hospital alone before. Since I couldn’t read, I couldn’t find the department I needed to go to. I was afraid to ask. I would spend so much time looking. Now I can find the hospital departments without asking anyone. I can read the door plates.”-Hamiyet K.

“My greatest wish was to learn phone numbers. When somebody gave me their number I couldn’t write it and I felt miserable. Yesterday I got a phone call. They wanted to talk to my husband. I said he wasn't home and wrote their phone number. I am so happy.” -Muteber B.

As surprising as it may seem, Emine, Hamiyet and Muteber live in Turkey’s largest and most cosmopolitan city, Istanbul. Until they enrolled in the Mother and Child Education Foundation (ACEV)’s Women Empowerment and Functional Literacy Program (FALP), they could not read.

These women are not alone. There are several thousands of women, of all ages, who like Emine migrated to Istanbul, but who are unable to integrate into city life because of illiteracy. Illiteracy does not just mean the inability to read or write. It is a situation that prevents, mainly women, from living a normal life. For the past year, FALP has helped to change that in three disadvantaged districts in Istanbul.

From October 2009, FALP has implemented a literacy program for women in their 30s and 40s in Eyup, Fatih and Kagithane, where there is a high percentage of migrants from southeastern and eastern Turkey. The majority are migrants with only a primary school education for the men and only a few years for the women. In most instances women from these parts of Turkey never even enrolled in a classroom.

With the assistance of three volunteer teachers selected by ACEV’s Functional Literacy Program, 65 women from these Istanbul districts developed basic primary school level reading skills in three months.

FALP aims “for participants to gain skills that would boost women’s status in society and the family, such as using literacy skills in daily life, benefiting form the right to lifelong education as an informed citizen, and understanding the importance of educating female children.” Raising literacy rates in Turkey is one step in the right direction.

As a result of ACEV’s literacy program, there are several dozens of women in Istanbul more confident and able to function independently in their daily lives. Pleased with its results, ACEV plans to offer more advanced courses for these women. It also plans to expand the program to other districts in Istanbul.

ACEV's FALP program is a recent grantee of TPF. Read more on the outcomes of the project here.