How to create an estate plan that reflects your values

In the U.S., those who prepare a will and create an estate plan are in the minority. In fact, 67% of Americans have no estate plan in place. While it’s not pleasant to contemplate your life coming to an end, thinking about the impact you want to make in your lifetime and beyond it is the key to leaving behind a meaningful legacy.

Not only can you ensure your family’s financial security and prevent family conflict with thoughtful estate planning, you can have an impact far beyond your immediate family through legacy giving.

Legacy giving and planned giving are terms that are often used interchangeably, but planned giving refers to any plan for donating to a cause in the future. Legacy giving refers to philanthropic donations that happen after you’ve passed away.

For those who feel strongly about causes, communities, and cherished values, legacy giving is a powerful way to lend long-term support.

Legacy giving can take many forms, through a number of different financial arrangements. And as with any philanthropic giving, legacy giving offers tax advantages: potential reductions in income, estate, and capital gains taxes.

Options for planned giving

The most common way to give to charity as part of an estate plan is through bequests, which are one-time gifts made through wills or trusts.

This can take the form of cash, personal property, securities, stocks, or even assets like real estate. A bequest can also be designated as a percentage of the estate.

When the estate completes the probate process, the executor of the estate will distribute the gifts to the organization.

However, gifts can be structured in a number of other ways. For instance, you can designate gifts of retirement plans, IRA rollovers, and life insurance policies, by making the charity of choice the beneficiary of those plans.

There are also forms of giving that have potential tax benefits now, as well as the future:

Charitable gift annuity (CGA). An agreement where you transfer assets to a charity in exchange for fixed annuity payments for life. When you and any beneficiaries you designate pass away, the charity keeps the remaining funds.
Pooled income fund (PIF). A charitable trust that can give you income distributions, with the remaining value given to the charity when you and any beneficiaries pass away.

How to get started

This is the most difficult step of all: giving yourself sufficient time and attention to reflect on your values. These are big decisions that cannot be rushed. Give yourself the time you need to make a plan that makes you proud, and a plan that is deeply personal to you.

Once you know what cause or community you want to support, many people find it helpful to reach out to professionals to guide them through the details of their legacy giving plan. Estate lawyers, financial advisers, and tax professionals can provide a full picture of the financial and legal implications of your plan—and how they fit in with your larger estate plan.

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Thinking about the impact you want to make in your lifetime and beyond it is the key to leaving behind a meaningful legacy.

From there, you can designate the charity of your choice as a beneficiary. And most people share their plans with the organization, to help them plan for the future that your gift is going to support.

No matter how large or small your donation, being able to create an estate plan that reflects your values is a gift you give to yourself as well as your family and your community. Create a plan that reflects who you are and what you want to see in the world, long after your lifetime.