PlannedGiving.com - Planned Giving

On Wednesday, April 28, the American Council on Gift Annuities (ACGA) board authorized new suggested rates, as of July 1, 2010. The new Rates are published at: http://www.acga-web.org/2010ratesjuly/singlelifejuly10.html. The decision leaves me asking one question: “Why?”

The rates moved up only VERY slightly.

Here is a sample of a few rates, and a comparison that shows how they moved:

• The rates stayed the same for 90-yr-olds & older (still 9.5%).
• 80-yr-old rates went up from 7.1% to 7.2% (that’s an increase of 0.1%).
• 70-yr-old rates went up from 5.7% to 5.8% (again, an increase of 0.1%).
• 60-yr-old rates went up from 5.0% to 5.2% (that’s a 0.2% increase).

Even though I usually caution fundraisers against promoting gift annuities by saying, “Fund a gift annuity now before the rates go down,” those campaigns can sometimes be effective. There is at least some reason for donors to make a move before the rates get worse. See my caution about this type of promotion at: http://plannedgiving.com/blog/2009/02/27/all-annuitants-are-women-and-they-lie-about-their-age/.

But no one will actually jump at “Fund an annuity now because we’ll give you more money later if you wait.”

From a purely profit-driven perspective, this could bring some new business to PlannedGiving.Com from people who need to update their brochures. It could move a few holdouts who write their own web pages to consider switching to a professionally designed and maintained VirtualGiving web site. But I didn’t have anything to do with the decision, so don’t blame me.

In my opinion this is pretty close to a non-event from a donor-relations and gift-promotion perspective, and nothing more than a hassle for the planned giving officers who promote gift annuities to their constituents. I don’t understand why the ACGA Board didn’t wait to make a change until there was a change that made a difference.