Charitable Giving

Nonprofit Day is August 17th

During the month of August, we are focusing on charitable giving.  According to Forbes, the “Great Wealth Transfer” is on the horizon.  “Over the next two decades, parents and grandparents are expected to pass down trillions of dollars (approximately $84 trillion, by one estimate) to charities and younger generations—particularly, Millennials and Gen Xers.”  It’s expected that the future heirs will be actively engaged in charitable endeavors.  This is due to an awareness of social injustices, a desire to have more of an active role in impacting change, and a mistrust in the government’s ability to problem-solve.

As we approach Nonprofit Day, which is celebrated every year on August 17th, it’s a good time to consider including charitable giving as part of an estate plan.  Enhancing a gift to charity is possible when using life insurance. 

(1)   New policies can be implemented for the sole purpose of charitable giving, if the insured has a history of gifts to the charity that warrants the death benefit and is healthy enough to qualify for a policy.

(2)  Existing policies can be gifted to charity.  The owner and beneficiary of an existing policy can be changed to a charity, then the funds to pay any ongoing premiums can be gifted to the charity from the donor.

(3)  Alternatively, it might be possible, based on the health of the insured, to exchange an existing policy for a new policy that does not illustrate any additional premiums.  After the exchange has been completed, the policy can be gifted to a charity by appointing them as owner and beneficiary.  In this scenario, there would not be any ongoing premium requirements for the charity to consider.

These options don’t immediately assist the charity with an influx of funds but can result in a large sum paid to the charity at a later date for a grand endeavor, such as forming a scholarship or having a facility built in the donor’s name.

Contact us with any questions or opportunities to help you or your clients achieve identified goals.  This is what we enjoy doing for only a select number of families, businesses, and charitable institutions each year, and we look forward to hearing from you.