Life Insurance Leverages Six-Figure Planned Gifts

Giving charitably has always been a part of Dean and Nancy Faracchio’s lives. That is why they decided to leverage dollars to purchase a $500,000 life insurance policy that will create an endowment at Tampa Orlando Pinellas (TOP) Jewish Foundation.

“We decided that we wanted to make several gifts over the next few years that would have a substantially positive impact on the Jewish community. Both Nancy and I felt that the best way to do this would be by leveraging our giving dollars through insurance,” says Dean, a professional Capital and Benefits Advisor.

“We chose to create an endowment that will support the Jewish education efforts at Congregation Ohev Shalom because fun and informal Jewish education is what gets kids involved, and frankly keeps them Jewish, ” adds Nancy, a Certified Financial Planner.

The Faracchio’s are paying annual fixed premiums on the life insurance policy. Since TOP Jewish Foundation owns the policy, the premiums will provide an annual tax deduction. Premiums will continue until there is enough cash value in the policy. The investment returns on the cash value can then pay the annual premiums.

When both have passed, the life insurance policy is paid to TOP Jewish Foundation creating an endowment. An endowment is a fund invested to earn income each year that is used to support a charities work while the principal remains invested perpetuating the endowment.

People can donate an existing policy by naming TOP Jewish Foundation as the policy’s owner and beneficiary. With this approach, an individual can receive an income tax deduction for the cash value of the policy, as well as, deductions for future gifts that cover premium payments.