Bethlehem Lutheran Church

Stewardship Creates Abundance

by Ted Contag
Stewardship Ministry Team

At Bethlehem’s leadership dinner in early October, a colleague of mine, Richard Andersen, Senior Financial Consultant with Thrivent Financial, spoke with us about stewardship. The stories he told and the points he made were so pertinent that the stewardship commission felt they should be shared.

Richard made three main points:

1. Stewardship is a calling,
2. Stewardship requires planning, and
3. Stewardship is generated from gratitude not guilt, and creates abundance not scarcity. He gave a couple of examples of clients with whom he has worked to illustrate his points.

Minnie was a client of Richard’s in her late 80's who is now deceased. She owned her home in south Minneapolis and had only one source of income, her monthly Social Security check in the amount of $695. Her husband died over 50 years ago. Her only child, a son, died of complications from MS over thirty years ago. Her only living relative was an older brother living in Washington state. During her lifetime she saved over $100,000 from her social security income that was all gifted to Community Emergency Service and her local church at her death. It was through planning that she was able to create abundance.

Many people would like to give more to charity to express their gratitude for all the gifts they have been given. However, the one thing that keeps them from giving is fear, fear that there will not be enough to go around if they give it away. Richard shared a story about Ed and Shirley who, through planning, were able to create abundance.

Ed and Shirley inherited $512,000 in assets. Had they sold those assets, they would have had to pay capital gains tax and been left with substantially less for themselves and for their children. Instead, they gifted those dollars into a charitable trust with The Lutheran Community Foundation. Ed and Shirley receive an annual income from the Foundation of $43,000 for the rest of their lives. At their death, four charities (including their local congregation) benefit from the underlying principle. To leave an inheritance to their two daughters, they purchased $512,000 of life insurance. $25,000 of the $43,000 is used to fund the insurance policy, leaving them a net income stream of $18,000.

The results of Ed and Shirley’s planning is as follows:

They avoid the capital gains tax on the inheritance. They receive an annual net income stream of $18,000 for their own use. As a result of the gift they get a substantial tax deduction that can be spread out over six years. Most importantly to Ed and Shirley, at their death, they leave tax-free gifts of $512,000 to the institutions they love and $512,000 to their daughters. Finally, they have not exposed themselves to additional estate taxes as both the charitable gift and the life insurance is owned outside of their estate.

The motivation for the gifting was Ed and Shirley's gratitude. Because they were willing to give the assets away they created abundance: abundance for themselves, for their children AND for their charities.

The stewardship challenge as I see it is to be able to recognize three things. First, recognize that you are being called to give. Second, learn that good stewardship requires good planning. Seek advice from those who understand ways to leverage your gifts—your pastor, your attorney, your financial consultant. Finally, realize that stewardship is generated from gratitude not guilt, and it creates abundance not scarcity.