Where can I keep some money for 200 years?
July 22, 2008 10:12 AM Subscribe
I have a project I'd like to start that I will never be able to finish. I want to create a fund of money to be used by my local library, the principle of which can never be touched. They will only be able to use a small percentage of the interest. Before they can start doing that, though, I want the fund to remain untouched for 150+ years to allow it to increase in size. The goal is to let this fund grow so large that the library can become autonomous on just the interest.
How can I set this up so that there are no legal loopholes to pilfer the fund? Where should the fund reside? Where can I find more information about these types of projects?
Thanks!
How can I set this up so that there are no legal loopholes to pilfer the fund? Where should the fund reside? Where can I find more information about these types of projects?
Thanks!
Sounds like you want to start your own Ben Franklin Fund. Start your research there?
From Wikipedia: "Franklin bequeathed £1,000 (about $4,400 at the time) each to the cities of Boston and Philadelphia, in trust to gather interest for 200 years. As of 1990, more than $2,000,000 had accumulated in Franklin's Philadelphia trust, which had loaned the money to local residents. From 1940 to 1990, the money was used mostly for mortgage loans. When the trust came due, Philadelphia decided to spend it on scholarships for local high school students. Franklin's Boston trust fund accumulated almost $5,000,000 during that same time, and was used to establish a trade school that became the Franklin Institute of Boston."
posted by bartleby at 10:43 AM on July 22, 2008
From Wikipedia: "Franklin bequeathed £1,000 (about $4,400 at the time) each to the cities of Boston and Philadelphia, in trust to gather interest for 200 years. As of 1990, more than $2,000,000 had accumulated in Franklin's Philadelphia trust, which had loaned the money to local residents. From 1940 to 1990, the money was used mostly for mortgage loans. When the trust came due, Philadelphia decided to spend it on scholarships for local high school students. Franklin's Boston trust fund accumulated almost $5,000,000 during that same time, and was used to establish a trade school that became the Franklin Institute of Boston."
posted by bartleby at 10:43 AM on July 22, 2008
QuantumMeruit: I assume from your handle that you are a law student. If so you should know that there is (generally) a charitable organization exception to the RAP and anyway a lot of states are virtually doing away with it via statute. And there may be no contingency depending on how it's set up; all the future rights could be vested immediately.
GernBlandston: my impression is that you are being too specific in the mechanics of your charitable efforts whereas you should be focusing on your ultimate goal and seeking professional assistance on the details of how to accomplish it.
You should talk to a trusts & estates lawyer in your area about how to best help fund this library (or some library in the future if one doesn't exist yet). He or she will probably be familiar with people trying to accomplish similar goals, and will know how realistic your plan is with your planned principal contribution and any potential future contributions. Moreover, he or she will probably know how best to handle disbursement limitations, discount rates, appreciation, and all that stuff to maybe reach some progress towards your goal in your lifetime or that of your children.
Try finding such a lawyer through local business groups or, if you don't do a lot of business networking, call the local bar association. Best of luck.
posted by rkent at 11:43 AM on July 22, 2008
GernBlandston: my impression is that you are being too specific in the mechanics of your charitable efforts whereas you should be focusing on your ultimate goal and seeking professional assistance on the details of how to accomplish it.
You should talk to a trusts & estates lawyer in your area about how to best help fund this library (or some library in the future if one doesn't exist yet). He or she will probably be familiar with people trying to accomplish similar goals, and will know how realistic your plan is with your planned principal contribution and any potential future contributions. Moreover, he or she will probably know how best to handle disbursement limitations, discount rates, appreciation, and all that stuff to maybe reach some progress towards your goal in your lifetime or that of your children.
Try finding such a lawyer through local business groups or, if you don't do a lot of business networking, call the local bar association. Best of luck.
posted by rkent at 11:43 AM on July 22, 2008
This is called an "endowment fund" in the library world. I am a librarian and I buy/process books off several endowment funds. I've never heard of an endowment fund to support operating costs in a library but I suppose it could be done.
Call the library in question (the business office, not the reference desk). They will have a development or fundraising office or can connect with one through their local system. The development officer can explain if/how they can do this, walk you through the process, and throw a party for you after the endowment is bequeathed. Beware though that endowments usually require pretty big lump sum to start (25K has been the lowest I have seen).
posted by holyrood at 12:35 PM on July 22, 2008
Call the library in question (the business office, not the reference desk). They will have a development or fundraising office or can connect with one through their local system. The development officer can explain if/how they can do this, walk you through the process, and throw a party for you after the endowment is bequeathed. Beware though that endowments usually require pretty big lump sum to start (25K has been the lowest I have seen).
posted by holyrood at 12:35 PM on July 22, 2008
rkent has good advice. You need to talk to an estates and trusts lawyer.
I'll simply add that I have my doubts that you will find an institution that will agree to this, even if legally it can be done. Plus, who or what will administer the charitable organization over the course of 150 years? Plus plus, your local library may well not exist in 150 years -- when, you know, we have robot bodies and breathe ammonia. There's a legal doctrine to deal with this possibility (cy pres, if I remember from law school 18 years ago), but that's not what you want.
Please ignore my intuitions if you have a net worth in the high eight figures or above.
posted by ferdydurke at 5:08 PM on July 22, 2008
I'll simply add that I have my doubts that you will find an institution that will agree to this, even if legally it can be done. Plus, who or what will administer the charitable organization over the course of 150 years? Plus plus, your local library may well not exist in 150 years -- when, you know, we have robot bodies and breathe ammonia. There's a legal doctrine to deal with this possibility (cy pres, if I remember from law school 18 years ago), but that's not what you want.
Please ignore my intuitions if you have a net worth in the high eight figures or above.
posted by ferdydurke at 5:08 PM on July 22, 2008
Contact The Boston Foundation. They handle donor-advised funds and special endowments like the one you are proposing. Basically, they would manage the money and would be responsible for disbursing it to the library according to your wishes.
posted by jrichards at 7:09 AM on July 23, 2008
posted by jrichards at 7:09 AM on July 23, 2008
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posted by QuantumMeruit at 10:22 AM on July 22, 2008