Financial planning for the greater good

Honor a loved one, support a cause

My grandma grew up during the Great Depression with 11 siblings on a farm in North Dakota.  She often did not have enough to eat and had to drop out of school in the 7th grade to work.  She survived polio at a young age and lived a long, fulfilling life with much hardship.  She was a tough woman.  In the end, at the age of 95, cancer took her life. 

I recently had a friend from high school leave friends and family behind after a long battle with cancer.  Cancer and many other diseases do not discriminate.  Unless you are directly involved in the research of these diseases, it is hard to determine how to make a difference.  For many people, planned giving is the answer. 

“Planned giving is a chance to leave a legacy to honor a loved one or support an important cause,” said Jamie Mager, director of Estate and Gift Planning at the American Cancer Society.

What is Planned Giving?

Planned giving is a thoughtful way of giving cash or other assets to a charity now, in the future, or upon death.  The donation typically creates tax benefits for the individuals that give and obvious benefits to the charities that receive the gift.  Gifts are usually part of an individual’s financial plan including their estate plan and can bring a great feeling of fulfillment. 

Often, the process of giving can be creative and the organization receiving the gift will provide help with the logistics.  Leaving a retirement account to a charity is an example of planned giving. 

“It is very common for individuals to leave a retirement account to a charity after their death.  An individual who inherits a retirement account has to pay taxes on any accumulations distributed while a not-for-profit organization is exempt from the tax consequences,” Mager says.

Flexibility and Support

Once you decide to leave a legacy through planned giving, charities will provide support.  A donor usually provides a gift to the charity of their choice based on prior experiences which may produce strong feelings regarding how their gift should benefit the organization.  Charities will provide resources to make sure the gift is utilized based on the donor’s wishes while making recommendations to make sure it is efficiently appropriated. 

“When we sit down with a donor, we ask, what is your story?  What interests you? We help them work with their professional advisors for a smooth process while looking at the bigger picture to make sure their wishes are met while their donation is used the most efficiently,” Mager says. 

Planned giving is an overlooked part of financial planning.  It can provide a sense of fulfillment to the donor along with tax benefits, and vital support to charities.  For potential donors, it is as easy as picking up the phone to contact the charity they are passionate about. 

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