Supporting Your Causes Without Financial Stress

April 22, 2024

By Jessica Stewart-Kuntz

Are you interested in contributing to charitable causes while ensuring your financial security in retirement? As we approach our senior years, it's crucial to strike a balance between financial stability and philanthropic endeavors. Thankfully, there are straightforward methods available to support charities while safeguarding your financial well-being.

Charitable Gift Annuities: A Simple Solution

Charitable gift annuities offer a hassle-free way to provide support to your favorite charities while securing a reliable income stream.

Here's how it works:

  • Giving Back: Make a charitable donation to the organization of your choice.
  • Lifetime Income: You and your chosen beneficiary receive regular payments for the duration of your lives.
  • Tax Benefits: Enjoy a charitable income tax deduction and possible tax credits for your donation.
  • Legacy Support: Upon your passing, the remaining funds go to support your designated charity, leaving a lasting impact.

You have the option to start receiving payments immediately or defer them to a later date based on your needs.

Charitable Remainder Trusts: Enhancing Financial Security

Charitable remainder trusts offer a strategic approach to increase your income while diversifying your assets, all while supporting charitable causes.

Here's how it works:

  • Asset Contribution: Transfer assets such as stocks, real estate, or cash to establish a trust.
  • Lifetime Income: You and your chosen beneficiaries receive regular payments for life or a set term.
  • Tax Advantages: Benefit from tax deductions upon contribution, along with potential capital gains tax savings.
  • Charitable Impact: When the trust matures, the remaining assets go to support your designated charity.

Tax Benefits for Savvy Donors

In addition to the satisfaction of supporting causes close to your heart, charitable giving also offers significant tax advantages:

  • Immediate Tax Relief: Receive a charitable income tax deduction and potential credits upon making your donation.
  • Capital Gains Exemptions: Avoid paying extra taxes on appreciated assets, such as stocks and property, when donating them to charity.
  • Estate Planning Benefits: Reduce your estate tax liabilities by gifting assets to charity.

In summary, charitable giving presents a means to ensure both your financial stability and the continued support of charitable causes. Whether through charitable gift annuities, charitable remainder trusts, or other avenues, prioritizing philanthropy in your financial planning can offer peace of mind and leave a lasting legacy of generosity.