Fall 2009

Foreword: Dead Aid
Meditation: The Great Ransom
Malawi: Reaching Millions by Ministry
Fundraising: Making a World of Difference
Nicaragua: Manna from the Sky
Nigeria: Cornerstone Academy
Business Groups: Changing Lives
Personal Finance
Young @ Heart
Impact

Personal Finance

RRSPs, RRIFs and Charitable Giving: By Maria Vanderspek

This article is written for our Canadian Supporters – the tax implications related to wills in Canada are very different from those of citizens of the USA.
What are RRSPs and RRIFs?

A Registered Retirement Savings Plan (RRSP) is essentially a special savings and investment account authorized and registered with Canada Revenue Agency where an individual can contribute a percentage of his or her annual earnings. Amounts contributed in any tax year can be deducted from your taxable income for that tax year, to a certain maximum. All income earned on funds in this account are tax exempt as long as they are not withdrawn from the account.

On the last day of the year in which you turn 71, your RRSP must be converted into what is known as a Registered Retirement Income Fund (RRIF). Earnings within a RRIF remain tax exempt, but there’s an annual amount which you are required to withdraw and pay income tax on.

The important aspect to remember is that RRSPs and RRIFs only allow for the deferral of income tax and do not provide a complete exemption from paying taxes. Generally, as funds are withdrawn from an RRSP or RRIF, either voluntarily or as required once an RRIF is established, income taxes are payable on the amounts withdrawn.

What Happens in the Event of Death
In the event of death, the value of your RRSP and/or RRIF is taxed as ordinary income in the year of death. Only in the circumstances where the RRSP or RRIF is either being transferred to your spouse or a dependant child, can the income tax be deferred until the death of your spouse or dependant child. So where the funds are not being transferred to a spouse or dependent child, the value of the RRSP or RRIF may be substantially absorbed by the tax liability incurred by it being viewed as taxable income.

Charitable Giving
Your RRSP or RRIF can be gifted to a charitable organization which will entitle your estate to a charitable receipt for the value of the RRSP or RRIF. This charitable receipt can then be used to offset the tax liabilities incurred at your death. As discussed in the previous article, the Income Tax Act expands the charitable tax credit available to an individual in the year of death, providing you with the ability to claim a charitable tax credit in equivalent to 100% of your taxable income for the year of death.

There are two ways in which an RRSP or RRIF can be gifted to a charitable organization at your death.
Firstly, you can designate the charitable organization as the beneficiary directly with the RRSP or RRIF holder. This is generally the preferred manner, as the gift of the RRSP or RRIF then becomes completely independent of your will and results in a very simple process. Upon receipt of your death certificate, the RRSP or RRIF holder is automatically authorized to pay the funds in the RRSP or RRIF to the designated charity and the charity is authorized to provide your estate with a charitable receipt.

Secondly, you can make a provision in your will that specific RRSPs or RRIFs owned by you are to be paid to certain charitable organizations. This is often used when the RRSP or RRIF account is substantial and you would like the funds of the account divided between several charities or only a portion of the value to go to charitable organizations. The process of making this gift is often somewhat more complex as the RRSP or RRIF holder will require formal proof of the executor of the estate and their authority to deal with the assets of the estate.

Maria Vanderspek is a lawyer with the firm Cline, Backus, Nightingale, McArthur LLP in Simcoe, Ontario. Maria attends Grace Free Reformed Church in Brantford, Ontario.

The material presented in this article is intended for information purposes only and does not constitute legal advice.


Giving to Word & Deed
Word & Deed invites you to prayerfully consider gifting your RRSPs or RRIFs for its ministries. We invite you to discuss making such a charitable gift with your legal advisors and/or accountants.
Word & Deed Ministries Canada Inc. 39993 Talbot Line, Talbotville, Ontario, charitable registration number 891200941RR0001.

IMPACT

The Great Ransom

1. What is a ransom?
2. Why is Christ the only possible ransom for sinners?
3. What are some ways we can all carry out the “great commission?”
   

Teach the Child the Truth

1. List a brief history of Cornerstone Academy in Nigeria.
2. What is Rev. Pever’s hope for the school? How does he hope to accomplish that?
3. What examples does Rev. Pever give to show that God’s Word is bearing fruit in the schools?
   

Manna From the Sky

1. What are the four projects that Word & Deed has assisted with in Nicaragua?
2. What details in the article show that the Word is being brought along with physical relief?
   

Reaching Millions by Ministry

1. What is the ratio of pastors to church members in the Nkhoma Synod of the CCAP?
2. Why is more pastor training so needed in Malawi?
3. What is homiletics?
4. What negative issues are causing worry for the pastors in Malawi?
   

Current Events

Through Word & Deed, we learn a lot about certain small groups of people in foreign countries. We don’t learn much about their countries overall, and unless there is a disaster, much of the news from smaller countries doesn’t make it into our media outlets. So here’s a very brief update of the most current happenings in a few countries as we went to press. Add the internet tags to your Favourites list and check up on these countries periodically. It will give you a better sense of what Word & Deed is really accomplishing in a broader context.

Nicaragua
Deposed Honduran president Manuel Zelaya was gathering supporters in Nicaragua near the border with Honduras. The Nicaraguan government, led by Daniel Ortega, supports him. Zelaya had tried to regain his presidency diplomatically, but had no success. Some tension was rising between the two countries.
The Moskito people, of the north western coast, have long been disgruntled with Nicaragua’s leadership and its treatment of them. They are lobbying for independent government.
Click here for information at the New York Times on Nicaragua.

Nigeria
“The predominantly Muslim region of northern Nigeria has had regular and often bloody outbreaks of sectarian unrest for years. In the latest wave of violence in late July 2009, scores of people were killed in clashes between the police and a fundamentalist Islamic sect that is opposed to Western education. The Nigerian police accused the sect of attacks on police stations in at least two northern states.
“The latest conflict differs from the interreligious clashes that have flared up in the region where Islamic law has been imposed, with mixed success, over the past decade. In November 2008, mob violence involving Christians and Muslims killed hundreds in the town of Jos.”
Click here for information at the New York Times on Nigeria.

Malawi
Malawians were concerned that their government is sliding towards a “constitutional dictatorship,” as President Bingu wa Mutharika’s government was moving towards passing a “Police Bill” that would allow it to regulate public assemblies and demonstrations. A similar move allowed Zimbabwe’s dictator, Robert Mugabe, to tighten his grip on power.
Click here for information at the Nyasa Times on Malawi.

Young @ Heart: New Beginnings

As I packed my son’s school supplies last month, I took a deep sniff and smiled. The smell of a package of sharp Laurentien pencil crayons always reminds me of September. New books, fresh paper, old friends, and neat classrooms! Yes, you say, and tests, projects, early bedtimes, and lots of rules. Hmm…maybe you haven’t quite got back into the school routine yet.
Here at Word & Deed, a different routine continues around the world.

In Nkhoma, Malawi, pastors are being taught more about the Bible and how to preach.

In Dakura, Nicaragua, much work is still being done to help families whose homes were destroyed by a hurricane. People are building their homes and making clean wells for water. At night they listen to God’s Word, learning that He is the giver of all good things. When wood was delivered to help them build their homes, many people cried and called it “manna from the sky”!
In Nigeria, the Cornerstone Academies are still a good, safe place for over 1400 children to receive Christian education.

In Colombia, perhaps construction has begun on the new John Calvin Christian School.

Did you notice that in all of these projects, people are learning? Teaching both practical skills and the truth of the Gospel is Word & Deed’s work in other countries. God’s Word exclaims, “[how] much better it is to get wisdom than gold! And to get understanding is to be chosen rather than silver” (Prov.16:16). A child in Nigeria can help himself and his country with an education. He will also learn that the “fear of the Lord is the beginning of knowledge” (Prov.1:7). This principle is the starting point for Word & Deed and the people we work with. Make it yours this year, too.
This month’s word search puzzle is made of words from the articles in this magazine. Words can be found vertically, horizontally, diagonally, forwards and backwards. The leftover words spell out a phrase found in Proverbs 3.

business
church
citizens
Colombia
Dakura
Gospel
group
homes
learn
Lord
Malawi
need
Nicaragua
Nigeria
Nkhoma
pastor
prayer house
school
song
Sunday
wells
wood
Word

Meditation: The Great Ransom

By Rev. William Pols

For there is one God and one Mediator between God and men, the Man Christ Jesus, who gave Himself a ransom for all, to be testified in due time. I Timothy 2:5-6
When we hear the word, ransom, we might think of kidnapping victims: innocent children stolen from their wealthy parents by evil men, demanding money in exchange for their lives. The very thought might stir our anger at such evil, and our compassion for innocent victims and anxious parents. Wouldn't you be willing to contribute some money for their rescue?
But the ransom of Christ is not for innocent victims, tied or handcuffed by evil men. It is for guilty law-breakers, 'lawful captives,' held by the righteous judgment of God and facing the penalty of eternal death. This is the true state of all the people of this world without Christ.
God's saving compassion for such people (like you and me) is the good news of amazing grace. He has provided the only ransom that can rescue from death. No mere act of power could break us free from our guilt and captivity to sin, and no amount of money could buy our deliverance. A great sum of money or jewels is sometimes called a king's ransom. Only a king could afford to pay such a treasure for a ransom price. But the only kind of 'king's ransom' that provides redemption for sinners is the death of Christ the King in their place. And so "He gave Himself a ransom.” As Jesus Himself said, the “Son of Man did not come to be served, but to serve, and to give His life a ransom for many" (Mark 10:45). He substituted His own innocent life to death under the curse we deserve. This ransom is great enough to deliver the whole lost and condemned world. It is a "ransom for all.” There is nothing lacking to its value and sufficiency to save the worst of sinners, whoever they may be.
God's will is that the testimony of this great ransom be carried to the entire world. And so Christ commissioned the apostles, such as Paul, the preacher and teacher of the Gentiles (I Timothy 2:7). This task belongs to the church until the end of time. This commission surely is the main reason why we are to pray for civil authorities, and for all men. It is so that this good news of Christ may advance.
Just as there is but one God and one Mediator, there is but one ransom that delivers from the curse and misery of sin. Nothing can be added to this ransom. No contributions are necessary or possible. It must only be announced to the captives of sin, and the Holy Spirit will do His gracious work of making its power known. If we have experienced the grace of this ransom, let us serve God's desire that all people come to the knowledge of this saving truth.

Rev. William Pols is the pastor of the Orthodox Reformed Church of Edmonton, Alberta.

Foreword: Dead Aid

By Rick Postma

Dambisa Moyo knows how to stir the pot. Moyo, a native of Zambia with degrees from Harvard and Oxford, makes the claim in her recently published book, Dead Aid, that after $1 trillion in development-related aid has been transferred from rich countries to Africa over the last 50 years, the continent is not only worse off, but much worse off.

Moyo admits that numerous factors are having an impact: colonialism, corruption, tribalism, a lack of transparent and credible institutions needed for the rule of law, respect for private property and secure personal liberty. But by far the most significant culprit, according to Moyo, is systematic aid (aid between governments). The billions of dollars of aid pouring into many African countries can be compared to having a rich natural resource. African governments don’t need tax dollars from their citizens and therefore aren’t motivated to enhance the rule of law and respect for private property. On the contrary, governments are motivated to present as bleak a picture as possible so that aid will be increased.

So as a representative of an organization which brings aid to the developing world, why do I point to Moyo? Moyo isn’t nearly as critical of aid from charities. She praises programs which help the local people stand on their own two feet while warning against increasing dependency. She asks everyone to stop treating Africans as if they are children. To this we at Word & Deed heartily agree. One of our three areas of emphasis is that projects need to move beneficiaries to self-sufficiency. Creeping dependency can be a subtle challenge; projects need to have an exit strategy.

This issue includes project updates from Nigeria, Nicaragua and Malawi. In Nigeria, operating costs for Word & Deed’s Christian schools there are almost completely paid for by parents of the children – the project has a goal of self-sufficiency. In Nicaragua, families who lost their homes to Hurricane Stan have been provided with building materials but are expected to contribute the labor themselves – the project has a goal of avoiding dependency.

Pastor Christo Heiberg’s article about Logos Ministries in Malawi highlights something that Moyo misses altogether: The root cause of problems in our world is sin – a broken relationship with God which spills over into all we are and do. The answer, as Rev. William Pols points out in his meditation, is Christ, the God-Man who lived and died to deliver sinners from the curse and misery of sin. Given that sin is the key problem, then projects like Logos Ministries, which seeks to further education and equip pastors and elders of the church, are critical to bringing hope into the appalling conditions many Africans find themselves in.
May the Lord richly bless all involved with these projects and may thousands upon thousands of sinners be reconciled to Him through the blood of His Son.

Rick Postma is director of public relations for Word & Deed Ministries.

Summer 2009

Meditation: Of Drones and Worker Bees
Forword: Volunteering in God's Kingdom
Impact
Orphans in Malawi
High Hopes and Lots of Prayer
New Life in the Clouds
Joyful Determination
Dutch Soup and Oliebollen
Saluting Volunteers
Colombia Updates
Young @ Heart