A debut book examines charitable gift annuities in America.
A charitable gift annuity—a financial device in which in exchange for an offering, a nonprofit organization provides fixed payments to a donor—is a concept that seems simple enough on the surface. But in Brown’s exhaustive work, readers learn that these annuities have a storied past. While the author makes mention of similar instruments in Ancient Rome and the Middle Ages, his in-depth investigation begins with a man named Benjamin Silliman. Silliman helped strike quite an arrangement for Yale in 1831, in which in exchange for paintings of the American Revolution by John Trumbull, the university would agree to pay the artist $1,000 annually for the rest of his life. The deal would require hard work and negotiations due to the fact that $1,000 was a considerable sum at the time and Yale was in need of funding. Following particulars of the Yale agreement, the book transports readers to the 1920s, a time in which there was a great interest in gift annuities. The gift annuity campaign of the American Bible Society was flush with advertisements and informative pamphlets. Of course throughout the rise of these annuities, a main concern was always the threat of default—“a nonprofit failing to make its legally required payments to annuitants who trusted the charity and depended on its promise of lifetime payments.” Later portions of the work explore methods to prevent defaults and the necessarily morbid concept of assembling “mortality tables” for donors.
While charitable gift annuities seem an unlikely subject for a Ken Burns documentary anytime soon, this book offers some intriguing insights. Readers may not thrill to the finer points of ABS meetings (such as this quote from one in 1927: “At this conference a detailed report on annuity rates as determined by objective was made by George A. Huggins of Philadelphia, the actuary who made the detailed study of the ABS’s annuities about a year ago”). But many details are extremely telling. To realize the renowned Yale needed money in the 1800s because, among other concerns, “the library was aging and small” is to appreciate the ways in which times and institutions change. In a similar vein, the explosion of gift annuities during the booming ’20s is an item even history-conscious readers may be unaware of. Audiences with any interest in America’s past know that the ’20s were roaring, but that they thundered with ABS ads touting an economically practical way for believers to give is likely to come as a revelation. Aside from the obvious takeaway of learning about charitable gift planning, the volume provides a further understanding of various periods and how beliefs from those eras have helped shape the present day.
While some passages can be a bit bland, this financial work delivers a succinct helping of historical illumination.