Fast Facts about Planned Giving
December 21, 2021
If you hear “planned giving” and think it’s only for people older or wealthier than you—or that it’s just too confusing—you’re not alone. However, planned giving is for people of all ages and economic statuses, and it doesn’t have to be difficult.
Check out these common planned giving misconceptions and get the answers you need.
#1. Planned gifts are complicated and confusing.
They don’t have to be. There are many types of planned gifts: Most are simple and affordable, like a gift in your will or living trust. You just need to find the one that best meets your needs. We can help you find the best gift for you. To get started, contact Matt Wolcott at email@example.com.
#2. Planned gifts are only for the wealthy.
Anyone can make a planned gift—no matter if your estate is worth $100 or one million dollars. Gifts of all sizes make a difference at United Way of Southern Maine (UWSM). In fact, you may even be able to make a bigger impact than you thought possible when you make a planned gift.
#3. Wills are only for older adults.
Having a plan for the future is important—no matter your age. An estate plan makes your wishes known and provides your loved ones with peace of mind.
By including a gift to UWSM in your estate plans, you create a legacy of support for the places, people, and causes close to your heart across York County and Cumberland County.
STEPS TO A BETTER ESTATE PLAN
Discover five simple ways you can ensure that your estate plan reflects you.
- Make the most of what you have. Meet with qualified professionals to form a financial and giving plan that satisfies your needs and meets your goals.
- Protect family and loved ones. Keep loved ones safe by making sure your estate plan is up-to-date. It should be reviewed regularly for changes in personal relationships, tax laws, births, deaths, and state of residence.
- Be tax-smart. Don’t let taxes place a burden on your family, with careful planning now, you can get the most out of your estate plan.
- Make sure your wishes are fulfilled. Use the services of a qualified estate planning attorney to draw up your will and other legal documents, ensuring that your wishes are clearly stated so there are no misunderstandings.
- Continue helping others after your lifetime. Gifts to charitable organizations, such as UWSM, in your future plans ensure your support for our work continues even after your lifetime.
CHARITABLE GIFT ANNUITIES
When you are looking for ways to help UWSM with our mission, you shouldn’t feel like you are choosing between your philanthropic goals and financial security. One gift that allows you to support UWSM’s work while receiving fixed payments for life is a charitable gift annuity.
Not only does this gift provide you with regular payments and allow us to further our work, but when you create a charitable gift annuity with UWSM you can receive a variety of tax benefits, including a federal income tax charitable deduction when you itemize.
DELAY YOUR PAYMENTS
If you are younger than 60 or don’t need your payments immediately, you can set up a deferred gift annuity. This allows you to delay receiving payments until a later date—such as when you reach retirement.
CHARITABLE REMAINDER TRUSTS
Looking for a way to give UWSM a significant gift? If you have built up a sizeable estate and are also looking for ways to receive reliable payments, you may want to check out the advantages of setting up a charitable remainder trust.
Benefits of a charitable remainder trust include:
- Potential for a partial charitable income tax deduction
- Potential for increased income
- Up-front capital gains tax avoidance
There are two ways to receive payments with charitable remainder trusts:
The annuity trust pays you, each year, the same dollar amount you choose at the start. Your payments stay the same, regardless of fluctuations in trust investments.
The unitrust pays you, each year, a variable amount based on a fixed percentage of the fair market value of the trust assets. The amount of your payments is redetermined annually. If the value of the trust increases, so do your payments. If the value decreases, however, so will your payments.
CHARITABLE LEAD TRUSTS
Do you want to benefit from the tax savings that result from supporting UWSM, yet you don’t want to give up any assets that you’d like your family to receive someday? You can have it both ways with a charitable lead trust.
There are two ways charitable lead trusts make payments:
A charitable lead annuity trust pays a fixed amount each year to UWSM and is more attractive when interest rates are low.
A charitable lead unitrust pays a variable amount each year based on the value of the assets in the trust. With a unitrust, if the trust’s assets go up in value, for example, the payments to UWSM go up as well.
A CHECKLIST TO HELP YOU GET STARTED
It’s important to review your estate plans regularly to ensure they still accomplish what you want them to, and to make sure they reflect life’s changes. Events like births, marriages, even new tax laws, should all trigger a review of your estate plans.
Each year, make reviewing (and updating) your plans one of your new year’s resolutions. Our checklist can help you get started.
- Review Your Will. Check for any changes that may need to be made because of a change in your life or because you want to add a charitable gift to organizations you care about, such as UWSM, in your plans.
- Confirm Your Executor. Make sure the person named is still the qualified individual you want to manage your estate, resolve claims and distribute the designated portions of your estate to your chosen beneficiaries.
- Update Guardians. Make sure you are still comfortable with the guardian named in your will for those under your care. If your dependents were minor children that are grown now, does a guardian still need to be listed?
- Review Your Beneficiaries. Make sure the beneficiaries you have designated for your insurance and retirement plans are up to date. Once you’ve named someone a beneficiary, let them know so they can claim the proceeds.
- Check Your Power of Attorney. Make sure your durable powers of attorney for financial and health care are current. Provide a copy of your financial power of attorney to the named person. Your health care power of attorney will need a copy, along with your health care provider.
If you have questions about your estate plan or are interested in including a gift to support UWSM in your plans, please contact Matt Wolcott at firstname.lastname@example.org.