April 17, 2024
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April 17, 2024
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Israel Bonds: Showing One’s Commitment to Israel

An investment in Israel bonds is an investment in the State of Israel. That is a phrase potential investors might hear from professionals and committed Israel bonds supporters when discussing investing in Israel bonds. What is not often said is that purchasing Israel bonds is so much more than a mere addition to one’s portfolio. While purchasing Israel bonds is seen by many as a perfect lifecycle gift, it is not always considered for personal investing. Whether through lack of knowledge or improperly gathered information, the purchase of Israel bonds—if considered at all—is sometimes viewed as merely another investment option, rather than the vital contribution to the State of Israel that it is.

Why invest in Israel bonds? Financially speaking, the State of Israel has never defaulted on payments of principal or interest on its bonds, according to the State of Israel’s prospectus. Even in times of market volatility, Israel bonds have been recognized as reliable investments. The State of Israel itself has a dynamic economy, currently well-positioned to outpace most other developed nations. Investing in Israel bonds is a means of becoming a stakeholder in one of the world’s most resilient economies.

Proceeds from the sale of Israel bonds have significantly contributed to Israel’s evolution into a recognized world leader in various technological fields. Bond capital has helped strengthen every aspect of Israel’s economy, enabling, among other things, national infrastructure development and enhancing national export growth. This counters one of the major misconceptions regarding Israel bonds—that they are only necessary when the State of Israel faces a crisis.

In 2013, a year without major national conflict, sales of Israel bonds in the U.S. surpassed $1.1 billion for the first time. This can be attributed to growing recognition of the value of investing in Israel bonds as well as confidence in the Israeli economy. The investment in Israel bonds has become an important financial tool, as well as a means of maintaining a connection with the State of Israel.

That connection is what drives the professionals and lay leaders of the Metropolitan, Northern and Central New Jersey Development Corporation for Israel/Israel Bonds office. Executive Director Lee Schwartz and Assistant Executive Director Celine Leeds have brought together a unique and diverse group of individuals to sit on the Regional Council as chairs of various divisions, who tirelessly work—separately and together—to ensure the State of Israel is never without financial support from bondholders.

Dr. Andrew Hutter, the General Chairman and also Secretary of the Israel Bonds National Board of Directors, and his wife Barbara, Co-Chair of the Women’s Division and a member of the National Women’s Division Council, have been strong supporters of Israel bonds for many years. Dr. Hutter stresses the importance of getting as many people as possible connected to Israel through Israel bonds.

“While the Israel Bonds organization has been successful we want to get more people involved. We want to increase the number of people because it is important to, and good for, Israel,” Hutter explained.

“It’s important for people to know that Israel Bonds is not a political organization. No matter who’s in power, in the U.S. or Israel, Israel bonds remain the same,” he continued.

Howard Cohen, Campaign Co-Chair, commented that “investing in Israel bonds is owning a piece of Israel for those of us not lucky enough to live there. It keeps us connected. The challenge is moving that connection from generation to generation. We must continue that connectivity to Israel. As a Jew, Israel is important.”

Hutter added, “Israel is important to everyone. There are many non-Jewish supporters of Israel bonds,” dispelling the notion that Israel bond investing is for Jews only.

Schwartz added, “Approximately 30 percent of our sales come from corporations and institutions, including banks, insurance companies, State and Union pension funds and foundations.”

Regarding the importance of a connection with Israel, David Halpern, member of the National Campaign Advisory Council and the International Board of Directors, and National Campaign Chair for many years, spoke of his personal connection.

“My parents survived the Holocaust. Israel has always been important to them, it is important to me and must be equally important to all of us. The State of Israel gave life to the Jewish people after its creation in 1948. Jewish life would have been very different if Israel had existed during the Holocaust,” he stated. “After Israel’s creation, Ben Gurion sent Golda Meir to New York to raise $25 million for Israel. She did it. The interesting thing was that the ‘investors’ thought it was charity. They thought they were simply helping Israel get her start. They were surprised when they got the principal and interest back on time. That has never changed,” he added.

“Israel bonds are not a charity, they are an investment, and a strong one,” added Dr. Hutter.

“Assistance to the State of Israel is vital,” Halpern continued. “It continues the living connection between the Jewish people and Israel. It is very different from other groups’ connections with their homelands, and must be treated as such.”

Roy Tanzman, Middlesex County Chair, Commerce & Industry Chair, and Government Relations Chair, also emphasized the importance of maintaining a strong connection with Israel through involvement with Israel Bonds.

“I have been associated with Israel Bonds virtually all of my adult life. My father showed me the way. He was on the National Board for decades. My parents traveled to Israel over 40 times, mostly with the Bonds organization and I have been there nearly 20 times,” he said.

Cohen added, “When I graduated college I went to Israel for the first time and got a ‘twitch.’ That is what started my Israel Bonds involvement. We want to involve kids who have been to Israel and also felt that same twitch—that joy and connection with Israel. We are hoping to work in conjunction with Birthright to capitalize on these kids who have gone to Israel for the first time, often with no background or connection to Judaism whatsoever, and gotten ‘turned on.’”

Tanzman continued, “Bonds can be purchased at any level from bar and bat mitzvah gifts to million dollar bonds.” In comparing the involvement with Israel Bonds between Middlesex and Essex counties, he stated, “I don’t think there is any basic difference. The amount of purchases may differ, but the feeling and effort is the same.” It is precisely this feeling and effort that are paramount in the success of the sale of Israel bonds.

The financial impact of Israel bond sales to the State of Israel is significant, and it is vital that Israel Bonds continues to meet its annual goals. Equally vital, but lesser known, is the importance of continually growing the number of investors. Many people are unaware that Israel bonds can be purchased as part of a pension plan or retirement account, or held in a trust account for the future. Israel bonds are investments, just as other bonds and stocks are investments, and they can become part of a diverse financial portfolio. Development Corporation for Israel/Israel Bonds is a broker-dealer and is regulated by the SEC and FINRA, and its salespeople are all registered representatives. Lay leaders are not allowed to sell Israel bonds in any fashion. They try to demonstrate the importance of Israel bonds in an effort to entice people to whom the registered representatives can sell these bonds.

“Israel bonds are securities just like other investments,” said Dr. Hutter. “We are lucky to have Lee and Celine and their entire staff. People can call the office and they will assist them.”

Checks to purchase bonds are written to ‘State of Israel,’ clearly showing investors where their money is going. Israel bonds can be purchased in large dollar amounts, but also in lesser amounts—as gifts or for personal investment purposes. There exist 2, 3, 5, and 10-year-bonds in varying amounts and with different interest rates, depending on the investor’s needs and financial situation. The professionals are committed to working with their clients to determine the best possible investment options. For investors looking to streamline the purchasing process, accounts with Israel Bonds can be opened online and, in fact, purchases of bonds under $100 (called e-mitzvah bonds) can only be handled this way. The hope is that the ease of investing will encourage and enable many people to become new investors, thereby increasing the number of people with a demonstrated commitment to the State of Israel upon whom Israel can rely.

“We welcome purchasers at all levels, even lower levels, because it shows they are committed to Israel,” said Leeds.

Last summer, during Operation Protective Edge, Israel was able to count on its bondholders for additional purchases which totaled $250 million. Schwartz credits a strong marketing campaign and people’s love for Israel as contributing to the campaign’s success.

Cohen commented, “When SCUD missiles were landing in Tel Aviv, people rushed to buy bonds. TV did a lot of the marketing for us. People love Israel, care about Israel and want to help.”

Online investing has only been made available in recent years. The young lay leadership wanted a simpler way to purchase bonds and Israel Bonds recognized the importance of meeting that need. Alan Schall, New Leadership Chair, is responsible for reaching out to the community’s younger members. It is important to reach these younger investors at their level which, in this case, meant opening bond sales online.

“One of our challenges is keeping young people involved. They do not have the history that their predecessors did, and we need to help sustain their commitment,” said Schwartz. “The lower financial threshold and ease of online purchasing will appeal to more people. It is a broader-based approach which will ultimately allow more investors to continue to support Israel.”

In the interest of increased involvement, Israel Bonds works closely with its lay leadership to plan events and programs which appeal to the community at large. In addition to Commerce and Industry, Government Relations, Women’s Division and New Leadership, there is the Health Professionals Division, the Labor Division, the Signature Society, and the Synagogue Division, each of which comes with its own challenges and agendas, but also works closely with the professional team in enabling successful annual Israel Bonds campaigns.

“The partnership between the professional staff and lay leadership in this region is based on mutual respect and working together towards common goals. The success of Israel Bonds means the success of the State of Israel,” said Dr. Hutter.

Campaigns are built from each division, through annual events, programs, parlor meetings and more. The Commerce and Industry Division is currently planning a tribute dinner, honoring individuals from the business, labor and Jewish communities. The dinner will promote solidarity for Israel locally and within the broader community.

In addition to National Leadership Delegations, the Health Professionals’ and Women’s Divisions send delegations to Israel, with each trip appealing to the particular interests of the people involved. The Signature Society is an important part of the annual campaign because its events cater to those purchasing a minimum of $250,000. Coupled with Commerce and Industry, the total sales represent almost 50 percent of the total campaign. The synagogue campaign is successful in large part due to the many High Holiday appeals and B’nai Mitzvah programs, which together are responsible for 50 percent of the region’s bond purchases. As part of this division, there is the newly created Regional Rabbinic Council, chaired by Rabbi Jay Kornsgold of Beth El Synagogue in East Windsor. Rabbi Kornsgold is a longtime friend and supporter of Israel Bonds, and added his own words about the importance of supporting Israel.

“Growing up, I remember the Israel Bonds appeals that took place each Yom Kippur at my synagogue. When I became a rabbi I wanted to continue the tradition of giving people the opportunity to invest in the State of Israel by purchasing Israel bonds. Bonds gives us an opportunity to invest in Israel by planting our roots in Israel and at the same time helping our investment portfolio. As Jews we have an obligation to ensure that Israel remains strong and vibrant. Bonds is a vehicle to achieve this,” Kornsgold said.

“When I meet with each bar/bat mitzvah family I also remind the bar/bat mitzvah that he or she may invest in a Mazel Tov Bond so that their connection to Israel can begin at a young age,” he continued.

Joseph Kushner Hebrew Academy and Golda Och Academy have B’nai Mitzvah programs designed just for this purpose. The b’nai mitzvah child receives an Israel bond as a gift from his or her classmates, starting them off in their “adult” lives as owners of a little piece of the State of Israel. The Friendship Circle shows its commitment to Israel by awarding its stellar annual volunteers with an Israel bond.

“Often, those who receive bonds as gifts are later inspired to give a bond as a gift,” said Leeds.

The ultimate goal, as Hutter said, is to “create an awareness where people think of Israel bonds for investments and gifts.”

Added Kornsgold, “When we buy bonds we truly make a difference. We send a message to the world that Israel is important in our lives and because of that we will invest in Israel today and build for tomorrow.”

Schwartz continued, “Whatever has happened throughout the history of Israel, we have always been able to provide whatever Israel has needed, regardless of the situation. Our goal is for that to continue. That is what Israel Bonds stands for.”

By Jill Kirsch

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