In the next few years, $22 billion is expected to transfer from one generation to the next in Central New York. Over the next 50 years, the expected transfer of wealth for our region is estimated at $240 billion. This is according to a study commissioned by the Central New York Community Foundation and conducted by the RUPRI Center for Rural Entrepreneurship.
As you evaluate how you will approach your own charitable giving and asset-transfer strategies, consider the following questions for yourself, your friends, or your business clients:
- Have you thought about carving out a portion of your estate for the community?
- Do you have charities that you support on an annual basis? Do you want to include these in your plan?
- If there was a way to maximize both the tax and community impact of your giving, would you be interested in exploring that?
A variety of planned-giving options, ranging from simple to complex, can be customized to meet each unique situation. For example, establishing a charitable bequest through a will is a simple way to reduce estate taxes. Establishing a charitable trust, while more complex, can provide flexibility and a life income. Gifts through retirement-plan beneficiary designations are simple and can be highly tax efficient.
These and many other giving tools provide great options to get started. However, updating beneficiary designations, changing title of assets, or creating a trust document is only the beginning. What happens if the nonprofit you designated to be supported today is gone tomorrow? What if you created a private foundation and the trustee passes away? Even the best plans can’t anticipate the full range of what the future may bring, but there are ways to protect your or your clients’ interests.
Today, people expect more than just a solid plan — they expect stewardship. They want to know that their intentions for charitable gifts won’t be lost over time. The best practice for philanthropic planning provides individuals with the opportunity to extend their generosity beyond their lifetimes, and provides an assurance that their gifts will be safeguarded. If crafted carefully, a charitable plan can offer more than just money to worthy causes; it can provide a way for someone to be remembered and to have their personal stories live on in the community.
As you consider a structure for your plans, you can take steps to determine not only the right type of gift, but also create a legacy plan that documents wishes for the future use of the charitable dollars you’ll leave to benefit the community. For some families, a facilitated discussion about the meaning behind philanthropic intentions and an individual’s history of community engagement can be a valuable exercise.
Lastly, when assessing your charitable plans, consider structures that allow for both resiliency over time as community needs and organizations change, while making it easy to change the plan when the need arises.
Thomas Griffith is director of gift planning at the Central New York Community Foundation. Contact him at firstname.lastname@example.org or (315) 422-9538.