Do you know where your money is sleeping at night?
You might not have realized that your money, the money you deposit into a bank account, 401K, or other investment account is doing anything. Much less sleeping! And of course, money doesn’t actually sleep, but it certainly does do things.
In church contexts we sometimes worry that saved money is “just sitting there.” We wonder if it wouldn’t be better, or more faithful, to use these monies for some new ministry or donation.
It is always important to ask if we are being faithful with our budgets, but the reality is that most money is not just sitting at the bank. Money is doing something while it is in a bank or investment account. It’s certainly not sitting idle. It may be buying stock in a corporation, or purchasing government bonds, or a myriad of other things. This is what is meant by investing. It is the process of investing that allows you to earn a return. Whether that’s a smaller return like a savings account, or a riskier, but potentially larger return, in an investment account.
While interest rates are high right now, and you have many options to earn a good rate of return, not all investing is created equal. There are many prominent financial institutions out there who are paying a decent rate of return, but they’re also likely investing your dollars in companies with which you do not share missional alignment. Think Big Oil, Big Pharma, Guns etc. Do you know what your current investments are doing?
At the Cornerstone Fund, every dollar invested goes toward supporting the Church and other faith-based nonprofits, in the form of low cost, low fee loans. Our loan specialists support and guide projects ranging from food pantries, to solar panels, to new roofs for local congregations. If you are interested in fighting climate change, supporting the LGBTQIA+ community, increasing access to affordable housing, or funding myriad other community building projects, then Cornerstone Fund’s Investing Program is a way that you can put your money to work for something you really care about.
Perhaps you or your congregation are particularly interested in Climate Change or support of LGBTQIA+? Cornerstone Fund has specific investing programs in those areas. If racial justice is one of the priorities for your church, then you might be interested to learn that 49% of our loan funding is currently going to African American congregations.
Cornerstone Fund’s Investing Program offers an incredible opportunity to both know exactly where your money is sleeping at night and to feel really good about what it is doing during the day. And the best part is that this is not a donation. Your money can contribute to positive initiatives, help to drive positive change, while also earning a competitive fixed rate return.
Our Investing Program offers both individuals and congregations a unique opportunity to take part in transformative Kin-Dom building, discipleship growing, and community development programs.
How can we do all this good, while also taking such good care of your money? At Cornerstone Fund we like to call it God Math.
Starting on December 7th we will be offering a four-part webinar series called “God Math,” which will highlight our Lending Program, Investing Program, The Cornerstone Fund Difference, Congregational Vitality and Community Development projects, and the God Math that ties it all together.
Cornerstone Fund Announces Betsey Saffar as New Vice President and Chief Financial Officer
Cleveland, Ohio (October 13, 2023) – Cornerstone Fund is pleased to announce Betsey Saffar as its new Vice President and Chief Financial Officer, effective September 18, 2023. In this Executive Leadership team role, Saffar will lead the Finance and Accounting team, prepare the Fund’s annual Offering Circular, and interact with the Board of Directors regarding the Budget and fiscal matters.
“I could not be more thrilled to have someone of Betsey’s professional caliber and personal compassions join and help lead our team,” Cornerstone Fund President and CEO Maria Coyne said of Saffar.
Saffar brings extensive non-profit and private-sector financial experience and an entrepreneurial spirit to Cornerstone Fund. She previously served as Chief Financial Officer and Executive Vice President of Achievement Centers for Children, a Cleveland, Ohio based non-profit that provides an array of services to children and adults with disabilities. Prior to that, Saffar was an accountant at Ernst & Young and also ran her own catering company.
“I’m thrilled for this opportunity put my financial expertise towards advancing Cornerstone Fund’s mission,” Saffar said. “I’m excited to be a part of a faith-based team that’s committed to investing in and building community.”
After earning a Bachelors Degree from The Ohio State University, Saffar studied Accounting at the Masters level at Cleveland State University and earned an MBA in Applied Management from Indiana Wesleyan University
About Cornerstone Fund
Founded in 1993, the United Church of Christ Cornerstone Fund (Cornerstone Fund) is a 501(c)3 non-profit organization and leading financial organization that provides transformative financial solutions to support and empower faith-based communities. Through strategic, financial investments and partnerships, Cornerstone Fund helps churches and faith-based non-profits achieve their financial goals while fostering community development and economic justice.
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Cornerstone Fund Announces Appointment of Chief Relationship Officer, Rev. Dr. Courtney Stange-Tregear
Cleveland, Ohio (June 6, 2023) – Cornerstone Fund is pleased to announce the appointment of Rev. Dr. Courtney Stange-Tregear as its Chief Relationship Officer, effective May 16, 2023. In this newly created role, Dr. Stange-Tregear will report directly to Maria Coyne, President & CEO, Cornerstone Fund, and will become an integral part of the executive leadership team.
With a wealth of experience and a deep understanding of Cornerstone Fund’s mission, Rev. Dr. Stange-Tregear will lead a relational approach in accomplishing current and future strategic goals. Her responsibilities will include utilizing storytelling, partnership, and community organizing methodologies to nurture relationships with internal and external collaborators of the Cornerstone Fund.
Rev. Dr. Stange-Tregear has been an esteemed member of Cornerstone Fund’s Board of Directors since 2019 and most recently served as Chair of the Governance Committee. Stepping down from the Board to assume her new role, she brings valuable insights and knowledge from her tenure.
Expressing her enthusiasm, Rev. Dr. Stange-Tregear stated, “Having served as a Board Member for several years, I am dedicated to the mission, vision, and ministry of the Cornerstone Fund. ‘Joining together in faith to invest in and build community’ is central to my calling! I have seen with my own eyes the potential of economic justice to transform the world and build beloved community. The Cornerstone Fund is where faith and passion meet strategy and impact.”
Prior to joining Cornerstone Fund, Rev. Dr. Stange-Tregear served as the Acting Conference Minister for the Pacific Northwest Conference of the United Church of Christ. Her experience also includes serving as the Minister for Church Vitality in the same conference from 2016 to 2022, as well as holding pastoral positions in California, Maryland, and Massachusetts.
About Cornerstone Fund
Founded in 1993, the United Church of Christ Cornerstone Fund (Cornerstone Fund) is a 501(c)3 non-profit organization and leading financial organization that provides transformative financial solutions to support and empower faith-based communities. Through strategic, financial investments and partnerships, Cornerstone Fund helps churches and faith-based non-profits achieve their financial goals while fostering community development and economic justice.
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What’s the 411 on ESA’s?
So, you want to start saving for your child’s education? That’s fantastic! However, if you are planning for your child’s education, the barrage of online information can be quite overwhelming. After learning about the different kinds of savings plans, you’re still left wondering: What is the best type of education savings account for my family? Are there withdrawal penalties? What is the minimum and maximum contribution per year? Which kinds of education expenses do these accounts cover?
The Basics
There are two main types of education savings plans: the 529 college savings plan and the Coverdell Education Savings Account, or ESA. While its original intention was to cover only the cost of postsecondary education, the 529 savings plan was recently amended through the 2017 Tax Cuts and Jobs Act (TCJA) to include education and tutoring expenditures for K–12 education as well.
Other families prefer to finance their child’s education with a Coverdell Education Savings Account, or ESA. This savings plan is an account that allows for families to use funds in a multitude of ways. Like the reformed 529 plan, ESAs can also be used for schooling other than college: private school tuition and fees, online courses, private tutoring, community college, higher education expenses and other approved educational services or materials.
Although there is a growing interest nationwide, right now, only five states have active ESA programs: Arizona, Florida, Mississippi, North Carolina, and Tennessee (Nevada’s program is currently inactive).
Benefits of ESAs
Here are the primary advantages of investing in an ESA:
- Tax-free withdrawals for unlimited qualified expenses for kindergarten through college (the 529 only allows for up to $10,000 for primary or secondary education). Some states even include preschool expenses, too.
- Flexibility in selecting the beneficiary–the funds can be rolled over to a qualified family member of the beneficiary.
- There are many investment options including stocks, mutual funds, exchange-traded funds, and real-estate investment trusts. Accounts can be set up by a bank, brokerage, or mutual fund company.
- You can invest simultaneously in both an ESA and a 529 savings plan in the same year.
- Contributions are not tax deductible, but money will grow tax free until deductions are taken.
As with any savings plans, there are also a few cons to consider:
- Annual contributions are capped at $2,000 for joint filers.
- Must be rolled over to a beneficiary by age 30 (529 savings plan has no age limit). Contributions cannot be made to the beneficiary after the age of 18.
- According to the IRS, there are income restrictions for contributing to the Coverdell Education Savings Account. Particularly, if your MAGI (modified adjusted gross income) is higher, you will not be able to open one of these accounts.
What’s New?
Education Savings Accounts have evolved from the former Education IRAs and as more states take interest in these programs, changes will be instituted on a rolling basis. The primary changes that have taken place in 2019–2020 reflect the available yearly contribution and income for maximum contribution. Originally, Education IRAs only allowed for a maximum of $500. Now, there is a $2,000 yearly maximum contribution. Additionally, the income limit now stands at $190,000 ($220,000 for joint-filed tax returns).
Start an Education Savings Account Today
Now it’s time to set up your ESA! First, you’ll want to choose the exact way you want to invest the money on your child’s behalf. Next, you’ll want to find an institution to set up your account. If you live in a state that does not have an established ESA program, you can find programs with institutions like Cornerstone Fund. Finally, contribute a designated amount each year to the account. It may not seem like much now, but saving up to $2,000 per year can be instrumental in funding your child’s educational milestones.
The Basics of Conscious Investing
Investing can be complicated, especially if you’re just starting out. An easy way to narrow down the types of investments is by examining which opportunities line up with your own personal ethics and values. Growing your money while making a difference? If it seems too good to be true, it isn’t. This altruistic form of allocating funds is called socially responsible investing.
What is Socially Responsible Investing?
Socially responsible investing, or SRI, is investing with a conscious. Essentially, social responsible investing is a merge between financial gain and making a positive impact. Whether it’s women’s or civil rights, anti-war efforts, climate change, or decreasing world hunger – every investment is made with the end goal of reallocating funds to a conscious cause. The actual process details excluding companies and types of investments that do not align these core values.
ESGs Work Hand-in-Hand With SRI
There’s a strategy used to round up values-based companies to invest in. And this strategy is broken into three categories: environmental, social, or governance impact, also referred to as ESGs.
Environmental: These companies are directly or indirectly dedicated to reducing their carbon footprint. If you’re looking to invest in green companies, you’ll want to ensure the company practices using green technologies, water and natural resource conservation, decreased pollution, recycling, and hazardous waste management.
Social: Companies that promote overall connectivity within the society at large. For example, companies that encourage employee retention and satisfaction, promote diversity and inclusion, and foster optimal company culture are ones that are viable options for social impact investments.
Governance: This refers to how the actual company is managed. Wanting to invest in a company that has ethical business practices and is committed to equal pay amongst its employees
Is Conscious Investing Right for Me?
If you want to invest, but prioritize investments that align to your values, then SRI is right for you. Financial outcomes are important, however, you’ll want to find the best values-based fit for your investment. This will require you to ask yourself key questions about your own personal values. Is investing in woman-owned businesses important to me? How about companies that promote sustainable energy? Perhaps you’re primarily interested in investments that give back to K-12 education.
Whatever, the cause, analyze whether the types of investments will match your moral, social, ethical, and/or religious views. Side note: SRI also means avoiding investments that directly misalign to your values, too. For instance, if one of your core practices is promoting internal health, you wouldn’t want to invest in a tobacco or cigarette production company.
There’s a ton of diversity in SRIs. Options include investing in individual SRIs or making socially responsible investments through mutual funds, index funds, or exchange-traded funds.
If you aren’t sure which companies truly align to your values, it’s best to hire a financial advisor that can provide guidance in this specific arena.
Saving for College with Education Savings Account
Saving for college before the first day of preschool
According to U.S. News & World Report, the average tuition and fees at private universities have increased 168% in the last 20 years. Since 1998, out-of-state tuition and fees have also increased by 200% at public universities, and in-state, public university college tuition and fees have increased a whopping 243%. Saving for college at a private university means saving $174,248 for a four-year, undergraduate degree. If tuition rises at the same rate, today’s preschoolers need to start saving for college at a rate that yields them more than $350,000 by the age of 18.
Saving for college with a Coverdell Education Savings Account
A Coverdell Education Savings Account (also known as a Coverdell ESA) is a custodial account for the purposes of saving for college (or any K-12 expenses). A Coverdell ESA, formerly known as an Education IRA until 2002, offers tax-free investment growth (and tax-free withdrawals for qualifying education expenses). Like a 529 plan, the Coverdell Education Savings Account can be used for tuition; unlike a 529 plan, however, the Coverdell ESA can also be used for books, supplies, equipment, academic tutoring, and other qualifying education expenses.
A Coverdell ESA, like its Education IRA predecessor, does have an annual contribution limit of $2,000 per student per calendar year. Given the rising costs of college, a Coverdell ESA can obviously not be the only part of your education savings plan. Instead, a Coverdell ESA should be treated like any long-term investment strategy—as a lower risk investment option. For example, at the Cornerstone Fund, a fixed-income term note can be used as part of your education savings plan (and overall investment portfolio for education) and marked as a Coverdell ESA. Other elements of your education savings plan can then be comprised of additional tax advantage programs like a 529 plan.
The limits to the Coverdell Education Savings Account (Coverdell ESA)
Besides its $2,000 annual contribution limits , the Coverdell ESA has a few other limits that any investor needs to know about, including a limit on contributions based on your adjusted gross income. As a custodian, if your income is $110,000 or more, you are not eligible to use a Coverdell ESA. T hat doesn’t mean that another qualifying investor (like a grandparent or other relative) couldn’t set-up a Coverdell ESA for the child. Keep in mind, however, that the annual contribution can only be $2,000 per child (in total, across all ESA accounts).
An education savings plan that reduces long-term student debt
Without an effective college savings plan, the student becomes a part of the student loan debt crisis. According to Forbes, current student loan debt in the U.S. totals more than $1.5 trillion. For example, borrowers in the Class of 2017 carry, on average, $28,650 in student debt. In Connecticut, that average student loan debt is $38,510. With an education savings plan that utilizes both 529 plans and a Coverdell Education Savings Account, a child can reasonably afford a secondary education after high school.