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By devoting their lives to philanthropic causes, Martha and Don Farley set an example not just for their children and grandchildren, but for every family
WHEN MARTHA AND DON FARLEY DECIDED four years ago to start a private charitable foundation, it wasn't to help them become philanthropists—that was a role they'd taken on very early in their lives together. But it did mark a new chapter that could carry forward their commitment to try to improve the world.
Don, now 95, and Martha, who passed away recently at the age of 87, met in 1946 when both were in college—Don a just-returned-home veteran and Martha a fresh-out-of-high school 18-year-old. They fell in love and talked of marriage, but each wanted to see the world first. Don graduated in 1948 and left to teach in a Christian school in China, and the following year, Martha left for India, spending two years helping to manage a hospital as a Methodist missionary.
"My parents wanted us to understand that there are lots of ways to live in the world that are good."
— Ginger Farley
After both returned home in 1951, they married, and Don got his degree from Yale Divinity School and embarked on a career as a minister. Along the way, they had three daughters—Carol, Sarah and Ginger.
Ginger remembers growing up in a household brimming with the excitement and energy of guests from around the globe. "My parents' world view was about caring for others, preserving resources, working in the community and embracing differences," Ginger says.
In the tumultuous 1960s, Don and Martha's beliefs compelled them to plunge into the pressing issues of the day. Both of them actively worked on issues surrounding civil rights, education, and women’s rights.
In retirement, Don and Martha stayed busy with their philanthropic causes and a shared passion for the arts. They were parents who taught by example, Ginger recalls. All three daughters became passionate supporters of social causes and the arts.
While the Farleys lived modestly and frugally, a sizable inheritance from Martha's family put them in a position to make an even greater difference with the causes they cared so passionately about. To help them direct their giving, they worked with a Merrill Lynch team led by financial advisor Steven Porter, as well as a tax advisor.
"The Farleys' main goal was always to find ways to put their money to work for the good of the community and for organizations that can make the world a better place," says Porter. He recommended ways that their money could have the most impact, without sacrificing their own or their daughters' financial security.
"The Farleys' main goal was always to find ways to put their money to work for the good of the community."
— Steven Porter, Merrill Lynch Financial Advisor
Tapping into the knowledge and experience of a trust specialist, Porter suggested the Farleys create two charitable remainder trusts (CRTs). The trusts were able to sell appreciated stock without triggering immediate capital gains taxes, enabling them to reinvest the entire proceeds. The trusts will continue to provide a stream of payments to the Farleys during their lifetime, with the remaining assets going to designated charities when the trusts terminate.
As an additional vehicle for giving, the Farleys formed a charitable lead trust (CLT), allowing them to make contributions to charities for a set period, with the remaining assets distributed to designated beneficiaries—in this case the Farleys' daughters—when the trust comes to an end.
To see to it that the Farleys would have enough to cover their income needs over generations, Porter and his team suggested supplementing the trusts with two additional strategies: an annuity to provide additional cash flow during Don's and Martha's lifetimes and an irrevocable life insurance trust. The latter, funded with a survivorship life insurance policy on their joint lives, would make tax-advantaged distributions to their daughters after both Don and Martha passed away.
"They did a very good job explaining how this would affect our holdings, and how we could set aside something to benefit our children while still supporting ourselves," Don says of Porter's team.
Even after funding the charitable trusts, the Farleys owned assets that were growing in value and could potentially be subject to capital gains taxes. That's when they decided to start their private family foundation. The Martha Struthers Farley & Donald C. Farley Jr. Family Foundation received its tax-exempt status in 2015 and shortly after that began making its first grants to charities. According to Ginger, establishing the foundation allowed the family to become more structured and formal in what was already a deep-rooted passion for helping others. "We've been doing these things. Now we can do more," Gingers says.
Martha's spirit lives on in the foundation. "We have 20 or more agencies that we support," says Don, who remains actively engaged. "That includes arts, community services in Evanston and church efforts to relieve suffering, among others." As board members, Don and each of his daughters have voices in selecting the causes they care most deeply about. Four grandchildren are beginning to take part as well. "We put together a mission statement based on the giving Mom and Dad had already been doing, and set up a system for proposing gifts," Ginger explains.
That mission statement also serves as a pretty good summary of how Martha and Don Farley have always lived: "To balance inequities, facilitate learning, protect the environment, promote peace, and to nourish creativity and artistic excellence."
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