The Individual Retirement Account (IRA) is a very popular savings program for millions of Americans. It is a structured retirement tool that provides additional financial security at the time of retirement.
The goal of building a retirement portfolio is to provide income when you stop working. You should start taking withdrawals when you need income, provided you have a strategy in place to keep your assets from depleting. Most financial advisors will suggest as a “best practice” not to take more than 5% in a given year, but your personal income may vary. Some investors may be positioned not to need income from their portfolio until well into their retirement.
It is important to understand that IRA Accounts are subject to RMD’s (Required Minimum Distributions). RMD’s are legally mandated withdrawals that begin to affect an IRA once the investor turns 72 years of age or 70 ½ if they reached 70 ½ in 2019.
The exciting benefit of an IRA is that Congress has enacted legislation to provide for a permanent IRA Rollover. The provisions of this legislation allow you to roll over up to $100,000 annually to a charity of your choice, tax free. Yes, tax free. To qualify, the funds must be transferred directly to our foundation.
For example, you could elect to make a pledge to VCSU’s Capital Campaign and use your RMD from your IRA, to make the annual payments on the pledge. Should you pass away prior to all the pledges payments having been made, the balance of the pledge can be made from your estate. This is an actual example of a gift made to our Capital Campaign by a friend/ donor to the university. In this case, the donor elected to make a pledge to the Capital Campaign of $1,000,000 from an IRA. The donor set the pledge payments to be made from his RMD in his IRA at $100,000 annually. The payments will continue over a 5 year time period. Should the donor pass away in the interim, the balance of the pledges due will be transferred to the Capital Campaign account.
Needless to say, the above scenario is exciting. This donor is being very creative and generous. He is in fact, creating the future today! This gift will touch the lives of future generations of students here at VCSU. It will be a gift that keeps on giving. His legacy is clearly in place!
As the Director of VCSU’s Capital Campaign, Forward Together, I encourage you give serious consideration to supporting our campaign. Every gift, big or small, is critical to the success of this campaign. I have had the honor of serving on the staff of our university since 1975, and I am also a 1971 graduate of VCSU. I assure you that this campaign is based on actual needs and not wants. It is my firm belief “that this is our time.” Join me as we move Forward Together!
Please direct questions regarding VCSU’s Capital Campaign to the VCSU Foundation Office at 701-845- 7203.
For more information on the Forward Together Campaign click here.
Larry Robinson ‘71
Capital Campaign Director