Leif & Aileen: Two in a Million
"If the numbers work, they work." That philosophy has served Leif Isaksen '62 throughout his career in the applied sciences. A physics major at Oxy, Leif earned his master's in physics from Rutger's University and his Ph.D. in electrical engineering systems/control theory (what we'd call "complexity" today) from USC. During and after graduate school, Leif worked for Douglas Aircraft helping to put man in space, including John Glenn. After moving to San Francisco to work for Systems Control Inc., he later owned and operated his own company for more than 20 years. Today, as a not-so-retired retiree, he volunteers for numerous Bay Area organizations. Numbers still play a factor in his life, though.
The numbers inspired Leif to create a charitable remainder trust benefitting himself and Occidental College earlier this year. It also took some prodding from his wife, Aileen, an MBA graduate of Columbia University and software systems in-house consultant for a labor union. Aileen remembered an article she had read on these unique types of gifts that pay you income for your lifetime, with the remainder going to charity upon your demise.
"I had a house that I had been renting for the last 15 years," Leif explains. "Although I was receiving a nice little income from the property, given the dramatic appreciation in its market value, I was earning less than a CD returns." Selling the property would have been problematic ("I would have had a terrible capital gain issue"), so instead Leif transferred the property to a charitable remainder unitrust managed by Occidental, bypassed the capital gain, and received a tax deduction for the gift. The trust then sold the house and invested the proceeds.
"I am now earning 6.5 percent in income from the trust, and this income will likely grow each year as the trust appreciates in value. "In physics you learn to play with the numbers, and economically this made sense," Leif says. "Plus, the charitable deduction and capital gains tax savings are like cash in hand, so I am making even more."
More importantly, he adds. "I am helping a place that is aligned with my interests. Oxy is educating a number of first-generation college students. I am a guy who volunteers and works with underserved kids. I want to leave a legacy to help these kids—I went to Occidental on a scholarship and have always appreciated it." Leif's unitrust will eventually fund need-based scholarships. "You have reasonable certainty the College will be around educating kids for a long time. This is a great way to make a difference."
Well, Leif and Aileen, the numbers add up—and we think you're two in a million.