Model Generosity-Leave a Lasting Legacy Through Planned Giving through the Global Church of the Nazarene Foundation for Saturday, 12 July 2014

Model Generosity-Leave a Lasting Legacy Through Planned Giving through the Global Church of the Nazarene Foundation for Saturday, 12 July 2014
“The people rejoiced at the willing response of their leaders, for they had given freely and wholeheartedly to the Lord.”(1 Chronicles 29:9a)
When we surrender our lives and our resources "freely and wholeheartedly to the Lord," we experience God's peace, presence, and blessings in unlimited ways. At times, it is extremely difficult to turn over certain areas of our lives to God. If we only ask, God is eager to empower us to do this with every passing day.
For more information on how to use your resources to support the future of your favorite ministry, please reply to this email or contact us by phone at 913.577.2983.
Check out our Facebook page by clicking here. We post articles relevant to donors, inspirational notes, and other helpful information.
Blessings,
Kenneth R. Roney, J.D.

President

PERSONAL PLANNER
Helping Children Tomorrow
Parents and children often have a different perspective on saving and spending. Parents of retirement age today were born during the Great Depression or during the 1940s and have a strong desire to save and invest in order to increase economic security.
Some of their children may have a different perspective. Because their children did not grow up during adverse economic times, they tend to consume more and save less. Understandably, many of these parents hope that their children could have greater economic security during retirement.
Mike and Kristi are recently retired. They have two children, John and Mary. Mike and Kristi bought a lot on an inland waterway when they were in their 40s. But the next year, Mike accepted a position in a state that was quite a distance from the waterfront lot. They've owned the lot for more than 20 years, but never built on the property because of the distance.
Mike and Kristi recently retired at age 65. They have good retirement income, a home that is paid for and good savings. Recently, Mike received a very good offer from a person who would like to purchase the waterfront lot. After receiving the offer, Mike and Kristi contacted their attorney, Steve, to discuss the best way to maximize benefits for them and their children.
Mike: "We have been very fortunate. Kristi and I have just retired and we have good income. We both get Social Security and also have two pensions. With that retirement income and our house paid for, we're doing fine."
Kristi: "You might remember that we mentioned buying this lot on the intracoastal waterway years ago. But after we moved south for Mike's new job, it was just too far to travel. We never ended up building our vacation home on that property. Now we've had an offer to buy that property at a great price. We told the person that we weren't quite ready to sell yet, but he still seems to be very interested."
Steve: "That sounds like a good offer and a good opportunity. It may be the right time to sell that lot. But you know that there is a lot of appreciation and you will pay a large capital gains tax."
Mike: "Yes, I know. We were doing some research and a friend of ours who is a gift planner for a charity said that we could save a bundle with a special trust. He called it a charitable remainder trust. We did some reading online and it seems like a good idea. But we don't actually need the income ourselves."
Kristi: "Mike and I like the tax savings. But we thought that maybe what we should do is give the income to John and Mary. They just don't save the way we have. I am very concerned about them. If they don't save more, they are going to need added income during their retirement. With all the financial uncertainty in America today, we would like to see if there is a way to help them."
Steve: "Many parents share your desire to provide some added retirement income for their children. You mentioned that charitable trust. Let me show you how a special version of that trust could help John and Mary."
"That trust is usually called a unitrust. I am going to explain how a retirement version of that unitrust could work for them. With your offer of $400,000, we could transfer the lot into the trust and after it is transferred, accept the offer. I suggest the $400,000 in the trust be invested for 20 years. With growth over those 20 years, it could increase to perhaps $1.2 million in value. That's of course depending on how the investments would be during that time, but that's quite possible. If we are able to grow to that level, the trust then would pay approximately $2.5 million to John and Mary during their retirement years. In addition, you would receive a tax deduction today of about $42,000 that could save another $14,000 in tax."
Mike: "So if we use that special retirement version of the unitrust, we sell tax free, get a deduction, and the trust grows until John and Mary retire. Then it pays a very good amount to John and Mary. That will very nicely supplement their other retirement income."
Kristi: "This sounds like a great use of that lot. It will answer my question on how to provide added retirement income for the children. Let's move forward with this trust."
Mike: "Plus, while it's a very long time into the future, there eventually will be a good gift to our favorite charity."
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SAVVY LIVING

Ergonomic Tools That Can Ease Gardening Pains
My 72-year-old mother loves to work in the garden, but has been plagued by various gardening-related injuries this year. Can you recommend any ergonomic gardening tools?
Gardening can be tough on an aging body. Working in a garden often involves repetitive stooping, squatting, kneeling, gripping and lifting. These and other movements can lead to back and knee pain, carpal tunnel syndrome and various other injuries.
Luckily there are many new gardening tools to help your mom and other injury-prone gardeners with their gardening chores. These tools are lightweight, comfortable to use and ergonomically designed to help protect her body from the physical strains of gardening.
Gloves: There are a number of specially designed gloves that can improve your mom’s grip and protect her hands while she works. The “Atlas Nitrile Touch Garden Gloves” (available at amazon.com for under $6) are coated with a flexible synthetic rubber to help with gripping gardening tools. Also, the “ReliefGrip Gardening” gloves (bionicgloves.com, $35) have extra padding in the palm and finger joints that can improve grip and cause fewer calluses and blisters.
Digging Tools: In addition to gloves, there are ergonomic tools that can help protect your mom’s wrists by reducing the bending and twisting movement associated with digging and weeding.
Radius Garden (radiusgarden.com) makes a variety of curved-handle hand tools and shovels that cost between $10 and $50. Corona (coronatoolsusa.com) makes the ComfortGEL and eGrip hand garden tools.
Another excellent product is the “Cobrahead Weeder and Cultivator” (cobrahead.com). This is an all-purpose digging and weeding tool that is available in a short handle version for close up work for $25 and a long handle version for standing work for $60.
Knee and Back Aids: Kneepads and garden seats can also protect your mom’s knees and save her back when working close to the ground. Some popular products sold today through the Gardener’s Supply Company (gardeners.com) – a leading developer and manufacturer of innovative garden equipment – are the “GardenEase Kneeler” ($70), which is a kneeling pad with support handles; the “Garden Kneeler” ($35), which is a kneepad/garden bench combo; and the “Deluxe Tractor Scoot with Bucket Basket,” which is a height-adjustable, swivel garden seat on wheels ($90).
Pruning Tools: Fiskars (fiskars.com) makes some of the finest ergonomic pruning tools on the market. The tools have earned the Arthritis Foundation’s Ease of Use Commendation because of their patented PowerGear mechanisms that increase leverage to make cutting three times easier than traditional pruners. The Fiskars PowerGear Hand Pruners, Loppers and Hedge Shears all cost between $25 and $48.
Bahco and Corona also make a nice line of ergonomic pruning tools and handsaws that you can see at bahcostore.com or coronatoolsusa.com.
Watering: To help make your mom’s watering chores a little easier, there are lightweight garden hoses, soaker or drip hoses that can be snaked throughout the garden, and hose chests that can automatically rewind themselves.
There are several companies that make ergonomic watering products. Water Right Inc. (waterrightinc.com) makes a variety of super lightweight garden and coil hoses. The DIG Corp. (digcorp.com) makes convenient drip irrigation kits and micro sprinkler kits. Finally, Suncast (suncast.com) is the leading manufacturer of self-winding hose reels and carts.
Container Gardening: Raised garden beds, trellises and container gardening is also an easier way to grow plants and flowers because it brings the garden to you, eliminating most stooping, squatting and kneeling. The Gardener’s Supply Company (gardeners.com) offers a wide range of raised beds and garden containers at prices ranging anywhere from $10 to $350.
Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Senior" book. The articles are offered as a helpful and informative service to our friends and may not always reflect this organization's official position on some topics. Jim invites you to send your senior questions to: Savvy Senior, P.O. Box 5443, Norman, OK 73070.
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YOUR PLAN

Current Gifts
As is the case with many families, there are times each year when Jim and Sharon focus their attention on gift giving. For years, they have created a gift list that includes family members, friends and loved ones. Last year Jim and Sharon made an addition to their list and began including their favorite charity in their giving plan.
Sharon: Years ago, I inherited stock from my grandmother. We held the stock for several years, but decided to sell a portion of it this year. The stock had gone way up in value, and our CPA informed us that we had a capital gain of nearly $120,000. We had always planned on making a charitable gift and the CPA reminded us that if we were to make a gift of this stock before the end of the calendar year, we would receive a charitable deduction on the gifted shares. This deduction will help offset the capital gains tax on the stock we sold.
Jim: We contacted our favorite charity to discuss the best way to make a gift. The gift planner noted some of the most common gifts - a gift by check or by transfer of bonds or real estate, to name a few. However, he also mentioned that it might be especially beneficial for us to think about giving some of our remaining appreciated stock.
Sharon: We were still holding $80,000 in the same highly appreciated stock and did not intend to sell, primarily because of the substantial capital gains tax we already faced. To sell any more would only increase our tax. The gift planner recommended that we consider an end-of-year gift that would help lower our taxes. He called this a Gift and Sale plan. It meant that part of our stock would be sold and the proceeds would come to us, and part would be gifted to our favorite charity.
Jim: That is what we decided to do. By giving the $80,000 in stock, we received two benefits. First, we avoided a large capital gains tax on that stock. And then, we received a charitable deduction. The deduction even offset the capital gains for our prior stock sale of $120,000. We are very pleased with the double benefits of our gift. And, we're delighted that we've been able to make a nice charitable contribution.
*Please note: The name and image above is representative of a typical donor and may or may not be an actual donor to our organization. Since your benefits may be different, you may want to click here to view a color example of your benefits.
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WASHINGTON NEWS

Bonus Depreciation Permanent Extender
On July 11, the House voted 258-160 to pass H.R. 4718. This bill will renew bonus depreciation and has permanent effect. This is now the fourth permanent extender bill that has been passed by the House. The Republican majority was joined by 34 Democratic representatives in a bipartisan vote.
House Ways and Means Committee Ranking Member Sander Levin (D-MI) continued to oppose passage of the permanent extenders. While Levin noted that he supports in concept many of the extenders, he observed that the cost of this extender was $287 billion over the next decade. Levin noted that this cost was not paid for through any tax increase. In addition, he observed that the intention of bonus depreciation was to be a temporary stimulus during a recession. If the temporary provision is made permanent, he believes that it will lose its effectiveness.
The House previously had passed extender bills to make permanent $500,000 in expensing of equipment for most companies, five-year built-in gains recognition for S corporations that previously were C corporations, the research credit and appreciated property charitable gifts from subchapter S corporations.
The House has pending seven other permanent extender bills that have passed the Ways and Means Committee.
Editor’s Note: The philanthropic sector hopes that the seven other potential tax extenders will pass the House during July. The charitable extenders that could be made permanent include the IRA charitable rollover, gifts up to April 15 of each year, enhanced deductions for gifts of apparently wholesome food, a simplified 1% excise tax on income of private foundations and enhanced charitable deductions for conservation easement gifts. House Republican leaders confirmed this week that they expect to schedule votes on these bills this summer. If the House does pass all 12 permanent extenders, then it will be in position in the November negotiations to seek either permanent passage or a longer duration (perhaps five years). The Senate is expected eventually to pass the EXPIRE Act of 2014 which extends 55 provisions for two years. The final tax extenders bill is expected by the end of November.
Keeping the Highway Bill on the Road
Both the House and Senate are facing an urgent deadline with respect to funding for infrastructure. Senate Finance Committee Chairman Ron Wyden (D-OR) stated this week, “With the Highway Trust Fund getting closer to running on fumes, Congress must get beyond the gridlock where each faction says, ‘It’s my way, or no highway.’”
Sen. Wyden and Ranking Member Senator Orrin Hatch (R-UT) announced a compromise on the Preserving America’s Transit and Highways (PATH) Act of 2014. The compromise plan will raise $10.8 billion over 10 years. The final funding date is not specified in the bill, but is anticipated to be through May of 2015.
The funding compromise received approval from Sen. Hatch. He stated, “Today’s proposal is a balanced and viable bill that addresses the immediate needs of the Highway Trust Fund. And while I had hoped our counterparts on the other side of the aisle would accept cuts to wasteful and low-priority spending as a way to pay for the bill, our proposal is nonetheless a bipartisan product forged by compromise. Moving forward, I am committed to addressing the chronic underfunding of the Highway Trust for the long term.”
The funding plan delays adjustments in pension funding interest rates, requires additional reporting on mortgage interest, allows withholding payments from Medicare providers with delinquent taxes and uses other technical changes to produce the $10.8 billion in revenue. Significantly, the Democratic plan to replace stretch IRA payments for children with a five year accelerated distribution was dropped from the final bill.
Editor’s Note: This bill shows how difficult it is for the House and Senate to pass legislation in the current political environment. The House bill will fund the highway program until May 31, 2015 and includes fairly similar revenue sources. However, it will be necessary for a conference committee to agree on the bill’s final language. The difficulty in passing this quite urgent legislation shows the challenges facing other provisions prior to the election. Given the current political situation, it is very likely that most major issues such as tax extenders will be deferred until after the November election.
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FINANCES
Stocks - Family Dollar Shows Improvement
Family Dollar Stores Inc. (FDO), a variety discount store, announced its third quarter results on Thursday, July 10. Although the company’s results missed expectations, investors saw signs that the company is on the right track.
Family Dollar reported net sales for the quarter of $2.66 billion, a 3.3% increase from the $2.57 billion reported during the same period last year. The sales increase masked a 1.8% decline in comparable store sales during the quarter, however.
Howard R. Levine, Family Dollar Chairman and CEO, had this to say about the company’s third quarter: “We are executing our previously announced restructuring initiatives to improve our performance. Our recent investment to permanently lower prices is resonating with customers; we are seeing savings from our workforce optimization efforts; and we are on track to close approximately 370 underperforming stores by the end of the fiscal year. We remain confident that these steps will position the Company to improve our financial performance and deliver higher long-term shareholder returns.”
Net income for the quarter was $96.5 million. This fell below the $120.9 million reported during the comparable period last year.
Like its discount store rivals Dollar General and Wal-Mart, Family Dollar faces many difficulties in the current economic environment. With a tepid economic recovery, many low-end consumers are purchasing less than they have in years past. This has cut into the revenues and profitability of Family Dollar and its competitors. Family Dollar has moved to cut prices in an effort to increase sales. In addition, the company has begun to offer newer products such as beer and frozen dairy. Investors are optimistic the company’s initiatives will help Family Dollar get back on track.
Family Dollar Stores Inc. (FDO) shares ended the week at $62.15.
Bob Evans’ Quarter Disappoints
Bob Evans Farms, Inc. (BOBE), a food processing and restaurant operator, announced its fourth quarter results on Tuesday, July 8. The company’s results disappointed investors and reinforced calls for management changes from activist investor Sandell Asset Management.
Bob Evans reported net sales for the quarter of $326.4 million, which was a decrease from the $333.9 million reported during the same period last year. Net sales also fell below pre-release estimates that called for net sales of $333 million.
“Fiscal 2014 financial performance was negatively impacted by several challenges beyond the Company's control, including unusually severe and sustained winter weather, historically high sow costs, and BEF Foods’ supplier disruption issues,” said Chairman and CEO Steve Davis. “However, by focusing on factors we can control, we continued transforming our businesses to remain relevant to our restaurant guests, food customers, and stockholders for years to come.”
The company recorded earnings per share for the quarter of $0.48, a significant drop from the $0.69 reported during the same period last year. Pre-release estimates called for earnings per share of $0.41.
Bob Evans saw a 21% decline in its earnings per share for the quarter, which was unwelcome news for management. Hedge fund Sandell Asset Management has been advocating for a shake-up in the company’s board of directors and will likely point to the fourth quarter as evidence a shake-up is needed. In addition to the earnings decline, the company reduced its guidance for fiscal 2015, lowering expectations for full-year earnings to $1.90 to $2.20 per share. Investors and analysts will be watching to see what happens to the brewing conflict between Bob Evans’ management and its activist investor.
Bob Evans Farms, Inc. (BOBE) shares ended the week at $46.73.
Alcoa’s Profits Take a Huge Leap
Alcoa Inc. (AA), the world’s largest producer of aluminum, announced its second quarter results on Tuesday, July 8. The company saw a surge in its net income for the quarter, which led its share price to reach a new 52-week high.
Alcoa reported revenue for the quarter of $5.8 billion. This number was up 7% from the first quarter for the year and in line with what the company reported during the same period last year.
“Our second quarter results prove Alcoa’s transformation is in high gear,” said Klaus Kleinfeld, Alcoa Chairman and CEO. “We are taking the downstream business to new profitability heights, capturing midstream demand as auto lightweighting accelerates, while continuing to relentlessly improve upstream performance. Our strategy of building a lightweight multi-material innovation powerhouse and a highly competitive commodities business is driving compelling and sustainable shareholder value.”
The company reported net income for the quarter of $216 million or $0.18 per share. This was an astonishing 157% increase from the net income of $76 million or $0.07 per share reported during the comparable period last year.
Alcoa’s quarter benefited from increased demand in the automotive and aerospace industries. The company expects that the aerospace industry will experience overall global growth of 8-9% in 2014. Alcoa’s success this year has seen its share price skyrocket, returning 47.2% so far. Following the earnings announcement, Alcoa’s share price hit a new 52-week high of $15.76 per share on July 9.
Alcoa Inc. (AA) shares ended the week at $15.97.
The Dow started the week of 7/7 at 17,064 and closed at 16,944 on 7/11. The S&P 500 started the week at 1,984 and closed at 1,968. The NASDAQ started the week at 4,478 and closed at 4,415.
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Bonds - European Woes Spur Treasuries’ Advance
Treasury prices rose on Friday, July 11 as investors grew concerned about the financial woes for Portugal’s second largest lender. In addition, two Federal Reserve presidents took competing views on the potential for rising inflation in the future.
The struggling European economy further disappointed investors this week when Banco Espirito Santo, Portugal’s second-largest lender, revealed that a parent company had missed a payment on short-term debt. Banco Espirito Santo claimed it had exposure of $1.6 billion at stake.
The news out of Portugal instigated a 12 basis point drop in the country’s 10-year government security to 3.86%. The drop in Portugal’s 10-year yield further added to the U.S. 10-year note’s attractiveness around the world. The 10-year Treasury note has produced an extra yield of 67 basis points compared to its Group-of-Seven counterparts, which include France, Germany and the U.K.
During early Friday trading the 10-year note yield fell 1 basis point to 2.52%. Yields move inversely to prices, so as yields fall prices rise. The 30-year bond fell 1.5 basis points to 3.35%.
Jim Vogel, Head of Agency-Debt Research at FTN Financial in Memphis, Tennessee, said that Europe’s continuing economic woes are now built into the Treasury price structure. “We now need at least a couple of more weeks to make sure Europe’s not going to disappoint further,” he said. “That will keep the long end of the Treasury curve in a lower range than it would be otherwise.”
Treasuries also reacted this week to differing inflation outlooks coming from Federal Reserve presidents Charles Evans and Charles Plosser. Evans, President of the Chicago Fed Bank, said he believes inflation is likely to be below 2% for the next few years. Meanwhile, Plosser, President of the Fed Bank of Philadelphia, expressed his opinion that the recent uptick in inflation is not an aberration and could continue.
The 10-year Treasury note yield finished the week of 7/7 at 2.52% while the 30-year Treasury note yield finished the week at 3.34%.
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CDs and Mortgages - Interest Rates Show Little Change
Freddie Mac released the results of its latest Primary Mortgage Market Survey (PMMS) on Thursday, July 10. The results show mortgage rates increasing slightly following the release of a better-than-expected jobs report last week.
The 30-year fixed rate mortgage averaged 4.15% this week. This represents an increase from last week when the 30-year fixed rate mortgage averaged 4.12%.
This week, the 15-year fixed rate mortgage averaged 3.24%. This was a slight increase from last week when the 15-year fixed rate mortgage averaged 3.22%.
“Mortgage rates increased for the week as the labor market appears to be improving,” said Frank Nothaft, Vice President and Chief Economist at Freddie Mac. “Based on the employment report, released last week, the U.S. economy added 288,000 jobs in June, gained 224,000 in May and increased by 304,000 in April. Also, the unemployment rate in June fell to 6.1% from 6.3% in May.”
The money market fund finished the week of 7/7 at 0.4%. The 1-year CD finished at 0.7%.
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Are you a Nazarene Legacy Partner (NLP)?  The answer is “YES” if you have designated any gift to a Nazarene ministry in your will, bequest, or estate plan. This could be a tithe on your estate, an insurance beneficiary designation to your local church, college, global mission, or any other Nazarene ministry you support.
Send us your name and contact information by reply email and indicate “I am a Nazarene Legacy Partner” and we will add your name to our NLP honor roll. To model generosity inspires others to do the same. Thank you for your interest in gift planning. To access any of this updated financial and gift planning information, please select our website.
Church of the Nazarene Foundation
17001 Prairie Star Parkway, Suite 200
Lenexa, KS 66220 United States
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