If you’re not familiar with the latest variation of the individual retirement account— it wouldn’t be surprising. It’s only gone into effect this year. 

ABOUT LEGACY IRAs

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• Unlike a traditional IRA, a Legacy IRA indirectly provides income to retirees through a Charitable Gift Annuity (CGA).
• A CGA is an agreement between a donor and a nonprofit organization, where the donor donates assets, and the nonprofit provides regular payments for life based on the donated assets, keeping the assets upon the donor’s death.
• The Legacy IRA allows individuals over the age of 70 ½ with a traditional IRA to take up to $50,000 as a one-time Qualified Charitable Distribution (QCD) to set up a CGA.
• To utilize the Legacy IRA, individuals may need to roll over their 401k funds into an IRA.
• The annual payout from the CGA must be at least 5%.

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BENEFITS OF USING IRA FUNDS FOR A CGA: 

• It allows donors to increase their giving and ensure their future giving matches their values.
• It lowers the donor’s tax liability in the year the CGA is funded by excluding the amount of the gift from taxable income
• It could satisfy all or part of a Required Minimum Distribution
• It sets up steady, lifetime payments to the donor, or “donor and spouse.”
• The minimum 5% return in annual payments is competitive with historic rates CDs and government bonds
• There is typically no cost to the donor to set up and administer the CGA. The nonprofit holding the funds will do all of that.

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WHO’S USING LEGACY IRA PROVISIONS TO SET UP CGAs? 

• Folks over 70 ½ with appreciated stock or mutual fund shares who want to reinvest some of those assets to generate more income—  without paying capital gains taxes.
• Those who want fixed, lifetime payments unaffected by the markets
• And those who want to ensure continued payments to a loved one without going through probate.

In the past, the inability to use pre-tax dollars to set up a Charitable Gift Annuity was a major obstacle to small donors. That obstacle is now removed

Proverbs 3:9 reminds us, “Honor the Lord with your wealth and with the firstfruits of all your produce.”

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On today’s program, Rob also answers listener questions: 

• Can my son take over my cosigned car loan under his name?
• Can I refinance my car loan with a 3% interest rate to lower my monthly payments?
• Should I consider cashing in my $20,000 whole life insurance policy and investing it in a CD for potential future growth?
• Should I put my rental property in an LLC for liability protection?

RESOURCES MENTIONED:

• LendingTree (
• Rate Genius (
• Bankrate (
• Christian Healthcare Ministries (
• App.Faithfi.com (

Remember, you can call in to ask your questions most days at (800) 525-7000. Faith & Finance is also available on the Moody Radio Network ( as well as American Family Radio ( . Visit our website at FaithFi.com ( where you can join the FaithFi Community, and give ( as we expand our outreach.

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LEARN MORE ABOUT: IRA Accounts

INVESTING IN A GOLD IRA: Gold IRA Account

INVESTING IN A SILVER IRA: Silver IRA Account

REVEALED: Best Gold Backed IRA

Should You Set Up a Legacy IRA?

For those looking to ensure that their wealth and assets are protected and passed down to future generations, setting up a Legacy IRA may be a good option. A Legacy IRA, also known as an inherited IRA, is a type of retirement account that allows individuals to leave their retirement savings to their beneficiaries after they pass away.

There are several reasons why one might consider setting up a Legacy IRA. First and foremost, it provides a way to pass on wealth to loved ones in a tax-efficient manner. By designating beneficiaries for the account, the funds within the Legacy IRA can be transferred directly to them upon the account owner’s death, allowing for the tax-deferred growth of the funds to continue into the future.

In addition to the tax benefits, setting up a Legacy IRA can also help to protect one’s assets from potential creditors and provide an added layer of security for loved ones. Unlike a traditional IRA, which may be subject to creditors’ claims, an inherited IRA is generally protected from creditors, helping to ensure that the funds are preserved for the intended heirs.

When considering whether to set up a Legacy IRA, it’s important to keep in mind that there are certain rules and regulations that govern how these accounts can be managed and distributed. For example, beneficiaries of a Legacy IRA must take required minimum distributions (RMDs) from the account based on their life expectancy, and failing to do so can result in penalties.

It’s also worth noting that the rules around inherited IRAs have recently changed, with the passage of the SECURE Act in 2019. Under the new law, most beneficiaries of inherited IRAs are required to withdraw the entire account balance within 10 years of the original account owner’s death, which may have tax implications for the beneficiaries.

Given these complexities, it’s important to speak with a financial advisor or estate planning attorney who can provide guidance on setting up a Legacy IRA and ensuring that it aligns with one’s overall financial and estate planning goals. They can help to navigate the rules and regulations surrounding inherited IRAs, and provide insights into how to maximize the benefits of such an account.

In conclusion, the decision to set up a Legacy IRA is a personal one that should be made in consultation with a financial professional. While it can be an effective way to pass on wealth and assets to future generations, it’s important to fully understand the rules and implications of doing so. With the right guidance, a Legacy IRA can be a valuable tool in preserving one’s legacy for years to come.