Three years ago the AgeConnect Fund was established for Age Concern Nelson Tasman, via a ‘trust transfer’ process, and it has proved to be a winning solution.

Trying to be economically sustainable, but …

Age Concern Nelson Tasman (“ACNT”) was almost certainly not unique in having ‘rainy day money’ set aside, with potential to earn passive income to fund ongoing operations, but the administrative burden to manage a series of rolling term deposits, in an increasingly low interest rates world was becoming an ongoing challenge.

ACNT was also not unique in facing the double-edged sword of sound financial management allowing the reserve to be built up, but the downside of funders viewing the reserve unfavourably when considering making grants; ‘you’ve got money, you don’t need ours’.

In addition, ACNT was also aiming to launch a bequests programme to support ongoing economic sustainability but had neither the resource to pursue bequests nor the mechanism to manage any should they be successful.

Board members also wanted to focus on determining the best way for money to be spent on achieving charity goals, not on the growing legal responsibilities of being a Trustee - the work of administering a charity can be onerous enough as it is.

An ‘everyone wins’ solution

Three years ago ACNT members agreed to grant their ‘equity reserve’ to the Top of the South Community Foundation to establish The AgeConnect Fund.

The Foundation protects, manages and grows the capital in perpetuity. The ACNT Board can call on the annual income proceeds to spend as they see fit. There is no administrative burden on managing the Fund, no Balance Sheet challenge for other funders to overcome, no exposure of Board Members to growing regulatory requirements for Trustees, certainty of passive income for Board members who follow in the current footsteps to deliver on ACNT services, and a simple mechanism in place to leverage future bequests.

And financially, in the three years since the transfer, had the amount been held in term deposits at an average 1% it would have grown by ~$8,900 / 3.03%. Managed by the Foundation the amount has grown ~$42 ,800 / 14.61%.

Everyone wins!  Not least the older people of the region who will benefit from the forever impact of ACNT service delivery.

Caroline Budge, Manager Age Concern Nelson Tasman, said the initiation of the fund under Top of the South Community Foundation management has been excellent.

“It has certainly been a real win-win. Not only does it help a small charity like us better manage our reserves and grow for the future, but it’s helping the Community Foundation grow its portfolio as well. We’re delighted to be working alongside the Top of the South Community Foundation and helping them become a greater force for good across Te Tau Ihu, but crucially of course protecting our own stakeholders at Age Concern.”