Tag: wealth management

What Does Wall Street Know About Charitable Giving that Main Street Charities Don’t?

Did you know that major fund companies such as Fidelity and Schwab are now getting into the charity game on behalf of their clients? They are educating their advisors on how to discuss setting up donor advised funds to ensure they continue to manage their clients’ assets for generations to come.

Charities too often take the position that their donors do not care about taxes when they think about giving. I understand this if the charity is simply looking at the $50 or $500 a donor is giving; however,  why would a charity give up the opportunity to build themselves into the estate and financial plans of their donors and members?

A lack of initiative by the charity will lead to declining revenues when many of their $500 annual donors pass away. The fact is that most people do not have charity built into their wills. It is then safe to assume that the charity’s donors will unlikely pass on any assets in their will to the charity or move to a higher giving amount without the proper insights and illustrations by the charity.

Clearly, financial institutions have been able to sharpen their focus on this key group of individuals who will be passing billions if not trillions to the next generation.

 

wpetruck@fundingmatters.com
www.giftabulatorusa.com
www.giftabulator.com

Donate to Eliminate

img-index-cover

I was encouraged to see the Laura Saunders’ article Tax Smart Philanthropy Made Easy in the Wall Street Journal (WSJ). This has been a key element of what we have been speaking to advisors, charities and individuals about in getting their estate, financial houses in order to minimize taxation on their capital gains now and in their estates. Tax planning means that advisors and their clients need to take an inventory of all assets now and over time to ensure that what is left over and taxed can be put to other uses like philanthropy.

 

The WSJ article talks about the increase in popularity of Donor Advised Funds such as those offered by Fidelity, Schwab and Rowe. The other option is to give directly to charity and see the impact of your giving. The Donor Advised Fund model is a very smart approach if you are undecided about which charities you may want to leave your money to, and the taxman is not one of your chosen beneficiaries.  It is also a wise strategy for future generations who will invariably be approached to give to charity.  Imagine having the luxury of helping society with pre-tax dollars.

 

An important element in smart tax planning is being able to see or have someone illustrate to you how lowering taxes can be achieved and what is required.  All too often, advisors do not spend the time to engage in these types of discussions for a number of reasons including, lack of knowledge or not having the tools to educate and illustrate these concepts to their clients.  Not-for-profit organizations are equally guilty of not informing and engaging their members with the information in a concrete manner. That is why historically, the number of bequests to charities has remained in the 4% to 6% range for many years.  Guess who is getting the rest after the family? You got it, the taxman.

 

The solution to this is GIFTABULATOR, an estate, financial and philanthropic planning app with an easy to understand model for planning purposes. GIFTABULATOR easily calculates how much money an individual will be left with, can pass on to their heirs and how much should be donated now or as part of an estate to reduce taxes at any point in the investment cycle. Can you imagine now how much you should give now to reduce your taxes on various assets? Call it Donate to Eliminate.

 

Laura Saunders’ article in the WSJ hits home about leaving a legacy for yourself, your family and your community.

 

Connect with GIFTABULATOR at app.giftabulatorusa.com

 

e. wpetruck@fundingmatters.com