6 steps to create your charitable giving plan
You don’t have to be Bill Gates to be a successful philanthropist. Learn how a charitable giving plan can allow you to make a lasting difference and fulfill your philanthropic goals.
The first step to becoming a more effective giver is to clearly define the values driving your philanthropic goals. That’s where a charitable giving plan comes into play. Designed to organize your intentions and prioritize the causes you care about most, a charitable plan can help you make a lasting difference in the world around you, as well as avoid reactive, last-minute giving that doesn’t thoughtfully further your purpose.
When the time comes to create your plan, you’ll want to start by establishing important details, including the amount of money you wish to donate, the organizations and areas of interest you’d like to support, and how much you want to set aside for casual donations, such as to children fundraising in your neighborhood. Working together, you and your advisor can apply these elements to your charitable giving plan, as well as determine tax-saving strategies – from bunching donations to opening donor advised funds – to help ensure your charitable dollars are doing the most they can.
As you prepare for this process, you can use the following six steps as a guide to help define and fulfill your philanthropic goals:
- Organize and strategize
- Write down the causes that matter to you and why.
- Determine the areas you most want to support, whether education, animal shelters, faith-based organizations, social services or something else.
- Think of who you’d want to be involved in your charitable giving goals. Would your spouse, children or other loved ones want to fulfill their own philanthropic aspirations by participating in your plan?
- Create a legacy of giving
- Clearly define the impact you wish to make and the best way to do so. Here are some questions to help guide you through this process:
- What motivates you to give?
- What are your charitable interests, and why?
- Where do you spend most of your time and money?
- Which life events have helped shape your worldview?
- What philanthropic values has your family passed on to you?
- Research organizations whose goals align with your own.
- Make your legacy your guide
- Create a mission statement for your legacy of giving.
- Consider creating an ethical will.
- Think of an ethical will as a family love letter, designed to pass on your values, personal lessons and hopes for your family’s future. Unlike a traditional will, an ethical will is not a legal document and is typically shared while the writer is still alive.
- List your giving priorities
- Rank your giving in order of importance.
- Include the criteria behind your ranking decisions, as well as instructions for when it’s appropriate to make ranking changes.
- Gather a team of experts
- Trusted professionals – including your financial advisor, accountant and lawyer – can help you determine the charitable giving strategies best fit for your needs.
- Examine which giving vehicles could be most effective for you, such as starting a charitable trust, private foundation or donor advised fund.
- Establish your charitable giving vehicle and review its structure.
- Reap the rewards
- Enjoy the personal satisfaction of investing in your values and doing your part to help create the world you envision.
- Share your successes and inspire others to fulfill their own philanthropic goals.
The best time to begin a legacy of generosity is now. Contact your advisor to learn how you can start creating your charitable giving plan today.
