dsmWealth: September 19, 2024

Des Moines benefits from big donors, but we all can pitch in
BY STEVE DINNEN

I was feeling pretty self-satisfied, just shy of smug, as I settled onto the lawn at Water Works Park to hear the Des Moines Symphony crank out a Labor Day weekend tribute to Billy Joel.

After all, just a day earlier, I’d sat in symphony offices discussing my gift of thousands of dollars to help the organization.

And then a slight personal buzzkill arrived right before the show, when an official from the Water Works Park Foundation announced that the family of Bob Burnett, the late chairman and CEO of Meredith Corp., was pledging $1 million to further the park’s evolution into a fantastic event and nature space. Hmm, thousands versus millions. I let my eye and mind wander and counted up where tens of millions of dollars had been poured into the park and its surroundings by civic-minded families.

Right in front of my face stood the Lauridsen Amphitheater, a gift from philanthropists Nix and Virginia Lauridsen that has quickly become a premier venue for outdoor entertainment. Next to it stood the Killinger Family Stage; Des Moines native Kerry Killinger once headed Washington Mutual.

Somewhere in the mix is the Hubbell Celebration Lawn. Was I lying on that? Thanks, Fred and family.

The tunnel that runs under Fleur Drive and links the Water Works Park with Gray’s Lake is the Ruan Connector, courtesy of the Ruan family. From there, you can circle the lake on the Kruidenier Trail, so named after newspaper operator David Kruidenier pledged $1.5 million in 1998 to help build the lake’s pedestrian bridge. (He and banker John Fitzgibbon also were the driving forces behind the Des Moines Civic Center, built in 1979, where Joseph Giunta leads the symphony’s indoor concerts.)

Smaller traces of individual gifts to this little swath of the city show up on signs honoring those who funded sidewalks that lead to the tunnel. And plaques along the the bridge at Gray’s
Lake indicate that Kruidenier inspired many others to pitch in, too.

And of course, hundreds of flowering crabapples grow near the amphitheater, courtesy of Arie Den Boer, who funded them, and got his hands dirty planting them, way back in 1930.

So, what have we covered, maybe one square mile of Des Moines? We’ve just scratched the surface, as this sort of community largesse has been repeated all over the city by hundreds of people with pockets large and small. I’m more of the latter, but I can still do my bit — and I applaud the Lauridsens and Burnetts for leading the way.

The smart way to make charitable donations from your IRA
BY STEVE DINNEN

I didn’t actually write a check to the Des Moines Symphony when I made my donation. Instead, I called my stockbroker and had him set up a QCD from my IRA and draw down my RMD. It’s a great way to make a charitable donation.

In plain English, I asked my broker to transfer the agreed-upon sum from my individual retirement account. The check was not sent to the symphony but instead to the Community Foundation of Greater Des Moines, which then forwarded the money to the symphony. This is the process to use when you want to make a qualified charitable deduction from your IRA.

And what’s the purpose of this go-around? Well, by law, IRA holders have to start taking payouts from their accounts once they reach age 73. These are known as RMDs, required minimum distributions, and they trigger a tax liability on the amount received. The RMD is calculated every year, based on a percentage of the year-end value of your account.

The Internal Revenue Service allows you to avoid incurring a tax liability if you send that money to a qualifying charity (most nonprofits qualify, but it’s a good idea to check first). Currently, you can direct up to $105,000 annually from your IRA to a charity. Donors can also direct a one-time $53,000 QCD to a charitable remainder trust or charitable gift annuity as part of the recent legislation known as the SECURE Act 2.0.

Qualified charitable distributions are made directly to the eligible charity from a traditional IRA, inherited IRA, inactive simplified employee pension (SEP) plan and inactive savings incentive match plan for employees (SIMPLE) IRAs.

Make sure you don’t take a distribution and then send the money to the charity. That route will trigger that tax liability.

What the Fed's rate cut means for consumers, businesses and investors
BY TAYLOR TELFORD AND JULIE ZAUZMER FOR THE WASHINGTON POST

The Federal Reserve cut interest rates this week for the first time in four years, putting an end to its longest cycle of rate hikes in roughly a decade.

“This will improve the material well-being of all Americans,” said Joe Brusuelas, chief economist at RSM US. “We had three years of extremely aggressive policy out of the Fed. We’re now pivoting toward the normalization of rates in the post-pandemic economy.”

The Fed lowered rates by a half percentage point. Any decrease in the central bank’s benchmark rate will ripple through the stock market, hiring, government bonds, and mortgages and other kinds of loans.

Michael Madowitz, principal economist at the Roosevelt Institute, said the rate cut will be “great news for the middle class.”

“Not only does it underscore the Fed is convinced that inflation is coming under control, it signals the economy has recovered to a faster, sustainable growth trajectory and is ready for further investments in job creation,” Madowitz said Tuesday in comments emailed to the Washington Post. “Lower rates should bring billions more in long-term investments off the sidelines and create thousands more long-term jobs.”

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How to give away a fortune
BY JOSHUA YAFFA FOR THE NEW YORKER

In January, Erna was having a coffee in her living room in Vienna when she opened a letter from something called the Guter Rat für Rückverteilung, or the Good Council for Redistribution. “Guten Tag Ernestine!” the letter began. “How wealth is distributed across the country shapes how we live together and influences how well a democratic society functions.”

The Good Council, the text went on, would comprise 50 Austrians selected by lottery — Erna was among 10,000 who made the first cut — and meet for six weekends to come up with proposals for how to address inequality in Austria, where the richest 1% controls half of the country’s wealth. Additionally, the council would have 25 million euros to distribute as it saw fit, money provided by Marlene Engelhorn, who was described in the letter only as the council’s “Auftraggeberin,” or principal client. The letter emphasized that the council would make decisions “freely and without influence.” Those selected as members would also receive 1,200 euros per weekend as compensation for their time and labor.

Erna, who is 80 and long retired from her job as a waitress in a corporate cafeteria, ripped up the letter and threw it in the trash. She lives on a state pension of 450 euros a month. What do I know about distributing millions? she thought. The next morning, however, she came across a newspaper article on the Good Council. Engelhorn, an activist and an heir to a pharmaceutical fortune, had announced its creation at a press conference in Vienna. She told journalists, “If politicians don’t do their job and redistribute, then I have to redistribute my wealth myself.”

Erna recalled the handful of euros she often gave a homeless man she passed in town, and the neighbor she’d accompanied to a shelter for victims of domestic abuse. She fished the scraps of paper from the trash, ironed them flat, and dialed the number included in the letter. Two days later, she received a call from a Good Council representative who asked her a series of questions about her income and education. By the end of the month, she had been selected as one of the council’s 50 members.

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