Planned giving allows every YFT supporter to leave a legacy and help families in need for generations to come. It is easy to add YFT to your will and estate plans. Learn about the best assets to make a planned gift including gifts of cash, securities and property. Discover gift options that provide tax and income benefits to help you meet your financial goals. Here are five ways to make the most of your gifts.
The gifts you make to the causes you care about...
...say a lot about you and the life you live.
Peace of mind comes from knowing that you have plans in place to take care of your own needs and those of your loved ones, as well as supporting the causes you care about. You can make a difference to those causes -and meet your own and others' needs - by taking advantage of any of the following five charitable giving and estate planning techniques.
Giving through your will
Everyone should have an estate plan. Only with a will or living trust can you ensure that your loved ones will be provided for and that your charitable goals will be met.
You can continue to support the causes you care about the most by choosing to give through your will:
- A percentage of your estate
- A specific amount
- Specific property such as stocks, bonds or real estate
- Part or all of the residue of your estate (what is left after all beneficiaries have received their bequests)
- A blended bequest - a specific amount plus a percentage or all of the residue
Example: Mr. and Mrs. Morris have been long-time supporters of a favorite charity and want to continue supporting it after they are gone. In their will, the couple stipulates that the charity receive a percentage of the remainder of their estate after their loved ones are provided for.
More than 60 percent of Americans own securities, so it is no wonder more people are giving stocks, bonds and mutual funds to charity. By giving securities instead of cash, you may benefit from tax savings that would allow you to make a larger charitable gift at the same cost to you.
Example: Mrs. Johnson has been making annual gifts to her favorite charity for several years. This year she decides to give the charity stock that is worth more than she paid for it instead of writing a check. Because she has held the stock for more than 12 months, Mrs. Johnson will not owe capital gains on the appreciated value, and she may also claim an income tax charitable deduction for the full fair market value of the stock.
Giving through retirement plans
You might be able to make a larger gift than you ever thought possible by giving "what's left" in your retirement account or pension plan. This allows you to stay in control of all your retirement funds during your lifetime and make a gift to the charity of your choice after providing for yourself and your loved ones.
Example: Mr. Thomas has saved for retirement but is concerned about running out of money. After meeting with his advisor, Mr. Thomas decides to give his favorite charity whatever funds might remain in his retirement account when he no longer needs them.
Giving life insurance
You may have a life insurance policy that you purchased to protect children who are now grown, family members who have predeceased you or to fund now-completed educational plans. Such unneeded policies, which may have a significant cash value, make excellent charitable gifts.
You might also consider naming your favorite charity as a contingent (or back-up) beneficiary should your primary beneficiary predecease you.
Example: Mr. and Mrs. Hanson discovered an old life insurance policy they no longer needed for its original purpose. They used the cash value of the policy to make a memorial gift to their favorite charity in honor of their parents.
Giving while receiving income
You can plan a substantial charitable gift now that will allow you or a person you designate to receive payments for life or for a set period of time. Assets remaining in this gift plan when the payment period is over will go to the charity you name.
These gift plans often result in tax benefits, such as preferential treatment of capital gains and an income tax charitable deduction, and can also be an excellent way to provide income for loved ones who depend on you for financial support.
Example: Mrs. Blake recently retired and has some securities that have increased in value substantially yet yield very little income. After consulting with her advisors, she uses the securities to make a gift that will provide her with attractive fixed payments for life. At her death, whatever is remaining will benefit her favorite charity. Additionally, she is delighted to learn that she will receive a substantial charitable income tax deduction in the year she arranges the gift.
We'd like to tell you more
The ideas here are just a few of the ways you can support the causes you care about. There are many ways you can make a difference by carefully planning what and when to give.
We will be pleased to provide you or your advisors with more information as you consider your plans.