Introduction
Planned giving is a way to support the causes you care about while also leaving a legacy that will endure long after you are gone. By including a charitable organization in your estate plan, you can ensure that your values and philanthropic goals are carried forward. In this article, we will explore some planned giving examples that can help you make a lasting impact.
Charitable Bequests
One of the most common forms of planned giving is a charitable bequest. This involves leaving a specific amount of money or a percentage of your estate to a charitable organization in your will or trust. This can be a straightforward way to support your favorite cause while also reducing the tax burden on your estate.
Example:
John wants to support his local animal shelter, which has been a cause close to his heart for many years. In his will, he leaves $50,000 to the shelter. This bequest will help ensure that the shelter can continue to provide care for animals in need long into the future.
Charitable Gift Annuities
Another planned giving option is a charitable gift annuity. This involves making a donation to a charitable organization in exchange for a fixed income stream for the rest of your life. This can be a good option for those who want to support a charity while also receiving a reliable source of income.
Example:
Sarah wants to support her local hospital, which has provided excellent care for her family over the years. She decides to donate $50,000 to the hospital in exchange for a guaranteed annual income of $3,000 for the rest of her life. This allows Sarah to support the hospital while also ensuring her own financial security.
Charitable Remainder Trusts
A charitable remainder trust is another way to support a charity while also receiving a source of income. This involves transferring assets, such as stocks or real estate, into a trust that pays out a fixed income stream for a specified period of time. After the trust expires, the remaining assets are donated to the charity of your choice.
Example:
Mike owns a rental property that has increased in value over the years. He wants to support his local library, which has been a valuable resource for his community. He decides to transfer the property into a charitable remainder trust, which will pay him a fixed annual income for the next 10 years. After the trust expires, the property will be sold and the proceeds will be donated to the library.
Conclusion
Planned giving can be a powerful way to make a lasting impact on the causes you care about. By including a charitable organization in your estate plan, you can ensure that your philanthropic goals are carried forward long after you are gone. Whether you choose to make a bequest, gift annuity, or trust, there are many planned giving examples that can help you achieve your goals. Consider speaking with a financial advisor or estate planning attorney to learn more about how planned giving can fit into your overall financial plan.
