Year end always seems to be the time to think about and perhaps catch up charitable plans. As with most things left to the last minute, not the best approach.
Whether you give to a disaster relief project, a faith community, a medical support or research group, or the the young family in your neighbourhood who is struggling, the payback is there.
Sometimes you get a tax credit, but that is a weak motivator. It is difficult to get more than you gave up. Charity emphasizes gratitude. Not the gratitude of the donee, but the recognition by the donor that they have enough, they have a little extra even. They are part of a bigger society and they can make it a little better.
Some people think they give to charity when they pay their taxes. After all, some of that money does provide relief to people who are hard pressed to get by on their own. Welfare, maybe artists, amateur athletes and first nations.
People who think that way have missed the point. Governments do not do things very well and you get no payback for paying taxes. Your don’t give money to the government, they take it from you. No great feeling of making society better there.
Big charities do good things, but some are becoming bureaucratic and wasteful. Once they like their task better than curing their problem, they are useless. Who will solve a problem if it puts them out of a job as soon as they do. Not many.
Find ones who share your goals. Find ones who plan for the future, not just for this week or month. Find ones who follow your ideas of value when it comes to spending and overhead. Find ones near enough to you that you can see the improvements.
Fund raising is difficult as the number of charities grows. Fund raising is expensive and will your charity get enough. Consider capital gifts. $50,000 invested at 4% is $2,000 a year forever. Who would replace you as your favourite charity’s $2,000 a year donor? Given demographics, probably no one. Then what?
Capital gifts in a will or while living are easily structured. Most people do them in their will. Life insurance is a very powerful capital gifting tool. Sometimes it is efficient enough to benefit you, your family, and your charity. If you get a chance reread this blog. How to give away your taxes.
Charitable giving matters. Think it through.
Don Shaughnessy arranges life insurance for people who understand the value of a life insured estate. He can be reached at The Protectors Group, a large insurance, employee benefits, and investment agency in Peterborough, Ontario.
In previous careers, he has been a partner in a large international public accounting firm, CEO of a software start-up, a partner in an energy management system importer, and briefly in the restaurant business.
Please be in touch if I can help you. email@example.com 866-285-7772