CHARITABLE PLANNING
Craig Wruck
What Is Planned Giving ?
And why should it matter to your wealthy clients ?
G
IVERS ARE OPTIMISTIC BY NATURE — THEY BELIEVE THAT through donations and other charitable activities , they will beget change , even if the result is not immediate or tangible . In the era of instant gratification , that requires tremendous discipline .
And one of the more disciplined yet often overlooked approaches to giving is one that involves a client ’ s values , their hopes for the future and thoughts about the legacy they ’ re leaving as well as careful considerations about their estate and tax planning .
This approach is known as planned giving .
What Is It ?
Planned giving means donating money or assets to charity during your client ’ s lifetime or as part of an estate plan and doing it in a structured way to achieve the most financially optimal results . It can involve giving a variety of assets , such as cash , securities , real estate , life insurance and money from retirement accounts . It can also include opportunities to secure lifetime income .
Creating and executing a planned gift involves tax and financial strategies , the clarification of charitable objectives , and the legal and administrative work required to document and carry out the donor ’ s wishes . The process involves calculating a charitable deduction ; preparing financial projections ; and drafting wills , trusts and other documents . Beyond that , it also includes the ongoing work required to achieve your client ’ s charitable goals and ensure the
It can involve giving a variety of assets , such as cash , securities , real estate , life insurance and money from retirement accounts . contribution is optimized for both them and the charity .
Many charities are willing to consider and accept complex planned gifts and even have gift planning specialists on staff . A gift planning specialist can serve as a key ally in helping you and your client explore and understand different gift types , structures and tax-efficient strategies for your client ’ s giving .
Why Should Your Client Make A Planned Gift ?
There are myriad reasons to use this approach , though the strategies and objectives differ for different clients . The motivations might be similar to the ones someone has for pursuing a donor-advised fund or private foundation . Here are a few of the more popular reasons a client might make a planned gift :
• They want to support a cause . Many people make planned gifts because they have a specific mission — they want to help people at risk , for example , or fund research on a particular disease , or preserve something like a piece of art or a natural resource .
• They want to leave a legacy . A planned gift can ensure a client ’ s values are carried on long after they are gone . This can take many forms , ranging from a donation that will put their name on a building or memorial to something more complex , like an endowed program or scholarship that evolves over time .
JUNE 2024 | FINANCIAL ADVISOR MAGAZINE | 21