We’re highlighting planned giving in honor of National Estate Planning Awareness Week this week. Join us as we cover the basics of estate planning and why it is important.
Estate planning, also referred to as legacy giving or planned giving, is the process of legally expressing how you want your assets to be handled once you’ve passed, or when you can’t manage said assets on your own. A proper estate plan ensures that your intentions for family, other loved ones, and your favorite nonprofits are properly met.
Why is estate planning important and how it can benefit you?
Create a lasting legacy
By organizing a planned gift, you are guaranteeing you will be remembered for your generosity and commitment for years to come. A planned gift ensures that you will continue to make a difference long after your lifetime.
Planned giving can help you leave a legacy that doesn’t affect your everyday cash flow. Because of this, planned giving is accessible to everyone, regardless of current income and investments.
Keep control of your wishes
With legacy giving, you can add stipulations in your will for how a gift will be used. This allows you the peace of mind that your legacy will be preserved the way you want. Your gift can be designated to a specific area of interest or need, or you can let the nonprofit decide how best to use it.
Legacy giving allows for a customized approach that fits each individual’s unique circumstances. This flexibility helps create a legacy that reflects both the tangible (financial assets) and intangible (values) aspects of your life.
Minimize taxes & secure tax benefits
By working alongside nonprofits and professional advisors, you can commit assets to your favorite nonprofit and participate in the numerous tax benefits planned giving can bring families.
Now that you know how legacy giving can benefit you, let's explore the three common types of legacy giving.
Bequests
Bequests are arguably the simplest and most versatile way to leave an impact for years to come. Why?
Typically all it takes is one sentence in your will or trust.
You can leave a specific dollar amount to our favorite nonprofit, a percentage of your estate, or the remainder of your estate after providing for your loved ones.
There is no immediate cost. Naming a gift in your bequest will not impact your current cash flow and always allow you to maintain control of your assets.
Life Insurance
When taking out a life insurance policy, a nonprofit can be named as a beneficiary. After you are gone, the nonprofit will receive the death benefit. An existing life insurance policy can also be transferred into the ownership of a nonprofit.
IRAs
If you are interested in joining a tax-deferred retirement plan, use an IRA by either naming the nonprofit as a beneficiary or as a recipient of a percentage of the proceeds. Many individuals utilize IRAs for legacy giving because of the tax efficiency, streamlined process, and flexible options.
What legacy giving method is right for you? Talk to your financial advisor/attorney about the steps to start your estate plan. Don’t have one? Check out the following links from Grow Cedar Valley to browse the best fit for you.
Let’s talk about options that work best for you and your family, and how we can customize your gift to create a lasting impact for Waterloo Schools students and staff, the Cedar Valley community, and beyond. Contact Hannah to set up a time to meet by emailing h.luce@wcsfoundation.org or calling (319) 214-0134.
Sources: plannedgiving.com,