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How to include charitable giving in your estate plan

On Behalf of | May 7, 2024 | Estate Planning |

Incorporating charitable giving into your estate plan is a thoughtful way to support causes and organizations that matter to you, even after your passing. Whether you are writing or updating your estate plan, it is helpful to know how to ensure your philanthropic goals are met through careful planning.

Identify your charitable goals

Start by defining what you want to achieve with your charitable giving. Are you interested in supporting a local charity, funding educational scholarships, or contributing to global causes? Understanding your goals will help you determine the best methods for including charities in your estate plan.

Choose the right charitable giving vehicles

There are several ways to include charities in your estate plan, each with its own benefits and considerations:

  • Bequests: Specify in your will that a certain amount of money or a percentage of your estate will go to charity. This is one of the simplest ways to include charitable giving.
  • Charitable trusts: Set up a charitable remainder trust or a charitable lead trust. These trusts allow you to provide for both your heirs and your chosen charities in ways that can also provide tax benefits.
  • Donor-advised funds: Contribute to a DAF during your lifetime and advise on donations to charities from the fund as long as you are able. After your death, the fund can continue making donations according to your instructions.
  • Life insurance policies: Name a charity as a beneficiary of your life insurance policy. This can be a significant gift and is often easier to arrange than some other methods.

Communicate your intentions

Make sure to communicate your intentions to your family and any involved charities. This transparency can help ensure that your wishes are carried out smoothly and can also involve your heirs in your philanthropic legacy.

Including charitable giving in your estate plan not only helps the organizations you care about but can also be a rewarding element of your overall financial strategy. With the right planning, you can create a lasting impact that aligns with your values and goals.