The human body is designed to age, and when the time eventually comes, the body will give out. Human life is designed to be finite, but the contributions of humans can live on for generations to come. If you are interested in achieving success in life that goes far beyond monetary gain, you can create a legacy for your name/brand by giving. Planning now for the legacy you want to leave behind allows you to educate yourself on causes that you may find close to your heart, and fosters relationships that enable you to leave behind gifts that have the greatest impact in the future. The following are some of the most common methods for creating a legacy through giving.
If you want to use your wealth and success to sustain generations of growth and prosperity, need‐based scholarships are one of the best options out there. The cost of college tuition is increasingly out of reach for average Americans. As of the 2016‐ 2017 school year, the average annual tuition for in‐state public school was $24,610.* The average annual tuition for a private four‐year institution was $49,320. Sending one person to school that otherwise may not have had a shot at college because of finances can have a trickle‐down effect on their children, and their children's children.
Nonprofits are increasingly turning to recurring donations to help support their initiatives. Rather than making one‐time donations annually or every other year, nonprofits have established sustaining donations. You can sign up to make smaller monthly donations that recur from one month to the next. The average donor that uses sustaining donations over one‐time gifts gives 42% more per year.
Donor Advised Fund
The National Philanthropic Trust states that a donor‐advised fund, DAF, enables you to give a donation now and enjoy an immediate tax refund, but work with the charitable organization in the long term to recommend grants for the use of that money. Think of it as a savings fund for the charity that you establish now, and then use that money over the course of the years to come to address different societal needs.
Charitable Remainder Trust
A Charitable Remainder Trust allows you to split your giving between a beneficiary individual and a beneficiary charity. You make payments into the trust and then establish a term period of no more than 20 years over which the beneficiary can enjoy a stream of income from the trust. The remainder of the money in the trust is provided to a charity of your choosing. This is considered a split‐interest giving vehicle.
Giving Through Life Insurance
Believe it or not, you can use a well‐structured life insurance plan as a vehicle for giving as well. Donors to the policy receive tax benefits, and you can structure the plan to ensure that the proper charities receive the right amount of funding in accordance with your wishes.
If you want to leave a lasting legacy on this world, remember that materials will fade. Charitable organizations can use your wealth to help improve the world you live in while you are here, and long after you have passed. Giving can create a legacy that no building can match. To find the best way to give your money to charity call your financial advisor at Manhattan Ridge Advisors.