Originally published 4/25/18.
New York Life policyholders Herman and Barbara Williamson lived a life of impact, so rich that even in death they continue to touch lives across Louisiana, Arkansas, and Texas. Herman passed away in 2011 at the age of 83; Barbara in July 2015 at 85, yet through their charitable donations, mostly funded with life insurance, the Williamsons’ legacy will live on for at least 50 years. For Agent Michael Fulco of the Shreveport Office, who worked with the Williamsons beginning in 1985, the process has been a joy and an education. “I’d been in this business almost 40 years and never really looked at funding charitable lead trusts with life insurance until the Williamsons. The far-reaching impact we can have by remembering our favorite charities and organizations in our wills and trusts is amazing.”
The Williamsons keenly appreciated both the protection and charitable aspects of life insurance. “I remember when Herman was 75 years old and kept buying more life insurance; I questioned him about it,” says Fulco. “But he knew what he was doing, building up all that insurance money with the intention of creating a large safety net for Barbara and to leave as much money as possible to his favorite charities.”
When he purchased a policy, Herman always named charities as the secondary beneficiaries, with Barbara as primary, says Fulco. Together, the Williamsons owned whole life, variable universal life, and term life policies. The charities the Williamsons supported in life continue to benefit from their generosity even after they’re gone. With more than $8 million in life insurance death benefits, and with Barbara’s well-being in mind, it was determined that a mix of charitable remainder trusts (CRT) and charitable lead trusts (CLT) were the best solution, and Mike worked with the client’s team of professionals to put a plan in place before Barbara passed away in July of 2015. The trust solution emerged after a conversation with Barbara, who wanted to spread the money to various charities.
“She was very conscientious and cared about the continuity of the charities she loved. I suggested funding a charitable lead trust fund that will send annual gifts to a handful of charities for the next 50 years or so in the name of Herman and Barbara Williamson. That way, she and Herman continue giving and helping people for decades to come.” Fulco and his team met the needs and desires of the client with two types of trusts. CRTs provide income to the donor for life or up to 20 years. At the end of the trust term, the charity receives the remainder of the property. CLTs also provide an income flow for a set period, but at the end of the term, the donated property may be returned to the donor or distributed to other non- charity beneficiaries. CLTs are one of the few charitable giving techniques that can generate an income and possibly an estate tax deduction.
A charitable gift given to the University of Arkansas through their charitable remainder trust created an endowed chair in the College of Engineering. “We are so grateful,” said John English, dean of engineering. “This chair will help us attract and support top-notch teaching and research in the College of Engineering. We’re honored to be part of the legacy of this wonderful family.”
The Williamsons’ estate has contributed through four charities through their charitable lead trust: St. Jude’s Children’s Research Hospital in Memphis, TN; Holy Angels, a residence for special needs children in Shreveport; the Louisiana Methodist’s Children’s Home in Ruston; and the Arkansas Children’s Hospital in Little Rock.
“This has been a beautiful team effort from everyone to make this legacy happen, from Herman’s vision for what he wanted for Barbara and his favorite charities, to Barbara having the generosity and willingness to set up the trusts, to the professionals working well together to make sure their wishes were carried out in the best way possible . . . it’s like the soul meeting strategy,” Fulco says.
“I encourage agents to talk to their clients about philanthropic options,” says Fulco. “They can create a beautiful legacy for years to come.”
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* Neither New York Life nor its agents provide tax or legal advice. Please ensure to consult your own legal advisors for guidance on trusts and tax advisors for guidance on charitable donations.