How to Leave A Lasting Legacy
While most of us aren’t world-class Olympic athletes, Oscar-winning movie stars or generals who command great battles, we still have a desire to leave some type of mark on this world.
For many people, that desired action is leaving a legacy while financially securing themselves, their families, their causes and charitable organizations long into the future.
Patrick Renn (http://www.patrickrenn.com/) has found a way to help others leave a legacy and reveals those strategies in his book, Finding Your Money’s Greater Purpose. “Each of us, through our contributions as volunteers and benefactors, holds the power to change the course of society for the better,” says Renn.
Renn suggests a number of ways to build a legacy and keep contributing to society even after we have left this world. (Editor’s note: Be sure to check with a financial planner or accountant to see if any of these strategies are especially suited to your situation.)
- Charitable Gift Annuity.
This is a contract between a donor and a qualified charity that can supplement retirement income and also give you a tax deduction. The annuity involves the donor making a gift to the charity and, in exchange the charity provides the donor with a lifetime fixed income stream.
- Give a gift of stock.
Let’s say you have a gain on a stock and want to give that to charity. To do so, you could sell it, pay the tax and give what’s left or you could first make the stock itself a gift. This gives you the full benefit of the gift as a tax deduction, and you avoid paying the capital gains tax.
- Donate your house.
You can make a commitment to leave your house to a charity after your death. By doing this, you can live in the house the rest of your life and receive a tax deduction. In all likelihood the charity will sell the house after you die and the money from the sale will end up as your final donation.
- Leave your retirement plan to charity.
Leaving money to a charity from your retirement plan could save a lot of headaches. A retirement plan is one of the worst assets to die with because of the taxes associated with it. Leaving the plan to a charity could be the most tax-efficient strategy for that money.
- Give your family choices with a donor advised fund.
You can leave your family a say in where your charitable donations are going via a donor advised fund. Family members could recommend where money from the fund is going now and after you’re gone.
- Donate a life insurance policy.
Insurance policies that no longer serve their purpose are a good place to look for charitable opportunities. Many people have outdated life insurance and have now outgrown their original need. Instead of cashing the policy in or just dropping it, why not consider donating it?