Today, I am seeign far too many charities accepting years of premiums for the potential of a death benefit later that is acutally costing the organization money!  The culprit, apparent big dollar death benefits with young donors.  The basic problem is a lack of understanding of the time value of money and cashflow analysis.  For example, a $250,000 gift from a 50 years old may seem large to the naked eye, but when you calculate the return on investment to achieve that same result in 50 years (when the donor reaches 100), the organization would likely fire its investment managers for similar performance.  So why are charities accepting such dismal returns when they could take those same donations, issue the same tax receipts to the donor, and invest in their endowment/long term investments for a superior gift?  That is the $1 million question!

I urge all charities to analyze the cashflows you are giving up before accepting giftgs of insurance.