Creating a lasting gift
By Michael Haubrich, CFP®
The Christmas season is always marked by a flurry of year-end activities including bestowing financial and non-financial gifts that have the opportunity of satisfying or becoming part of a structured planned giving strategy.
It’s with great joy that we have the privilege of working with clients on establishing gifting strategies that help ensure the impact they want for their legacy. Legacy gifts can be directed by the giver in several ways. Some opt for one or more to include gifts to people, gifts to projects that are meaningful to them, and infrastructure gifts.
Gifts to people
Gifts to people can take the form of donations to scholarships or other similar opportunities which allow others to learn and build skills in particular areas that will eventually enable them to impact society. For example, an endowed scholarship provides a long-term investment in education, enabling donors to support students in perpetuity. It is established with a principal amount that is invested, and the annual interest generated from this fund is used to award scholarships. Endowed scholarships provide ongoing financial assistance to students year after year, ensuring a lasting legacy of educational support. They align with donors’ values by enabling them to support specific fields of study, underrepresented groups, or other causes they feel strongly about. For recipients, these scholarships reduce the financial strain of higher education, allowing students to focus on academic and personal growth. Endowed scholarships are often named after donors or in honor of loved ones, offering a lasting tribute and an opportunity for the donor’s values and vision to be realized and to live on.
Gifts to projects
Some donors opt to contribute to research as part of their gifting strategies. Contributions to research often lead to lasting impacts, ensuring the donor’s name or values are associated with meaningful advancements for generations. Many donors establish named research funds or fellowships, creating a tangible representation of their commitment to progress. Research donations can help drive innovation, advance medical breakthroughs, and address pressing global challenges, creating a ripple effect of benefits for generations to come. Research projects often require significant financial investment for equipment, experiments, and salaries. Donor contributions provide critical resources that help drive discoveries and innovations in science, medicine, and technology. Donor funding can help expedite the timeline for breakthroughs by filling funding gaps, enabling researchers to focus on their work without delays caused by limited resources.
Infrastructure gifts
Contributing to capital improvements, such as funding buildings, facilities, or infrastructure projects, offers mutual benefits for both the giver and the recipient. By supporting physical projects, donors create a visible and lasting impact. Their contribution becomes a permanent part of the institution or community and can include opportunities for public acknowledgment, such as plaques, naming rights for buildings or spaces, or recognition at events. This can enhance the donor’s personal or professional reputation and provide a sense of pride and accomplishment. As with other gifting, donors can support projects that reflect their passions or priorities, such as funding a hospital wing, community center, or research lab. This ensures their contributions align with causes that matter most to them.
Capital contributions from generous donors enable organizations to build or improve facilities, expand their capacity, and enhance the quality of their services. These improvements often have a direct, positive impact on the individuals and communities served. A well-funded capital project often inspires confidence in other donors, leading to more contributions and additional resources for the organization. Upgraded facilities can elevate the organization’s profile, attract new stakeholders (e.g., students, patients, or patrons), and create opportunities for growth and innovation.
A legacy gifting strategy allows you to support the causes and organizations that matter most to you, ensuring your philanthropic efforts continue beyond your lifetime. Whether it’s contributing to a local charity, funding educational scholarships, supporting a nonprofit’s mission, donating to specific projects like research, or contributing to capital improvements, your legacy gifts can create a lasting impact that reflects your passions and values.
Benefits of strategic gifting
Strategic gifting can help reduce the tax burden on your estate, allowing more of your wealth to go toward the people and causes you care about. Donations to qualified charities can often be deducted from your estate’s taxable value, which can result in significant savings. This approach not only preserves your legacy but also enhances the financial well-being of your beneficiaries.
Incorporating a legacy gifting strategy into your estate plan transforms it from a transactional process into a reflection of who you are and what you stand for. It’s an opportunity to leave a meaningful imprint on the world while optimizing the financial and emotional benefits for your loved ones. By planning thoughtfully, you can ensure that your legacy extends far beyond your lifetime.
Legacy gifting doesn’t have to wait until you’re gone. We have worked with numerous clients who adopt the “giving while living” approach to their strategic gifting choices. Making charitable contributions during your lifetime allows you to witness the positive outcomes of your generosity. This proactive approach not only gives you personal satisfaction but also sets an example for others to follow and may encourage others to develop their own gifting plan.
As always, our team of advisors stand ready to partner with you on achieving all your Great Life goals, including developing and implementing your legacy, in whatever form you envision.
