From Rental House to Enduring Impact: Susan's Story

For nearly 30 years, Susan Miller owned a small three-bedroom rental home that she and her late husband had purchased for $120,000. It had been a good investment and a reliable source of supplemental income in retirement.

By the time Susan turned 74, the home was worth approximately $650,000.

The rent — about $36,000 per year — helped cover her living expenses. But being a landlord had become exhausting:

• Tenant turnover every few years

• Plumbing issues and roof repairs

• Property taxes and insurance increases

• The unpredictability of vacancies

Susan didn't want to pass the burden to her children. She also didn't want to sell and lose a large portion of the gain to capital gains and depreciation recapture taxes.

Her advisor introduced her to a Charitable Remainder Trust (CRT) .

A Different Kind of Sale

Susan transferred the home into the CRT. The trust then sold the property for $650,000.

Because the trust is tax-exempt, it was able to sell the property without triggering immediate capital gains tax, allowing the full proceeds to be reinvested into a diversified income portfolio.

Susan received:

• A charitable income tax deduction of approximately $346,000

• The elimination of landlord responsibilities

• A professionally managed investment portfolio

The trust began paying her 5.5% annually, providing about $35,750 per year - nearly the same income the rental had produced.

But now, her income arrived consistently, without surprise expenses cutting into it.

Income, Simplicity, and Growth

Over the next 15 years, Susan received more than $668,000 in income payments .

Because the remaining assets were invested for long-term growth, the trust principal continued to appreciate even as it made payments.

Susan often told friends, "I traded leaky faucets for lasting impact."

The Legacy

When Susan passed away at age 89, the remaining trust balance was $690,000 . ( We typically use 6% since this is net of investment expenses and 8% would be very high)

That entire amount went to the local nonprofit she had supported for decades - substantially more than the home's value when the trust was created.

What started as a modest rental house ultimately became:

• Reliable lifetime income

• Reduced tax burden

• Financial simplicity

• And a charitable gift likely larger than the original property value

For Susan, it wasn't just about getting out of managing a home. It was about turning a personal asset into a lasting statement of generosity - without sacrificing her own financial security.