Planning Pointer
Charitable Planning That Keeps Your Options Open: Wills and Trusts
Published June 2006
You may have hesitated to make a charitable gift to Saint Rose because of the current demands on your resources or concerns about future needs like health care or retirement income. Some charitable gifts enable you to change them if needed; they don't lock you into commitments that may prove inconsistent with your evolving goals and objectives. This month, we begin a three-part look at so-called "revocable" gifts.
One of the most popular revocable gifts is making a provision for Saint Rose in a will or trust. Often our friends could not fulfill these commitments out of currently available assets.
If you have a particular goal in mind for these ultimate charitable gifts, it is necessary to take the appropriate steps to include Saint Rose in your will or trust during your lifetime. After making such provisions, you continue to use all of your assets however you choose. If needed, you may alter the provisions at a later time.
Many people find that a gift to Saint Rose of a certain percentage of an estate or trust ensures that other goals will not be inadvertently compromised.
Example: Ron W has an estate currently worth $2 million. Based on that amount, he would like to provide for a gift of about $500,000 to Saint Rose and divide the rest of his estate between his two children.
Ron realizes that over the remainder of his lifetime the value of his estate could fluctuate. If he made provisions for $500,000 for Saint Rose and his estate was reduced to $1 million, his children would receive just $500,000—an amount he finds unacceptable. On the other hand, if his estate continues to grow and reaches $4 million, he would like significantly more to go to Saint Rose.
As a result, Ron decides to make a percentage bequest. He directs 25% of his estate to Saint Rose and 75% to his children rather than specifying a dollar amount.
Our next installment will examine another simple means of making a revocable charitable gift—the beneficiary designations in such financial instruments as life insurance policies and retirement-plan accounts.
If you would like more information about making a gift to Saint Rose through your will or revocable trust, please click here.