Charitable estate planning, legacy planning and life insurance are important tools that can help individuals build a lasting legacy while giving back to their communities. These strategies not only benefit the charities and causes you care about, but they can also provide significant tax benefits for you and your heirs. In this guide, we’ll explore the key considerations for charitable estate planning, legacy planning and life insurance.

Charitable Estate Planning

Charitable estate planning involves leaving a portion of your estate to one or more charitable organizations. This can be done through a variety of vehicles, including charitable trusts, donor-advised funds, and bequests in your will. By incorporating charitable giving into your estate plan, you can ensure that your legacy will continue to support the causes you care about long after you are gone.

One of the most common charitable estate planning vehicles is the charitable remainder trust (CRT). A CRT is a tax-exempt irrevocable trust that provides income to the donor or other designated beneficiaries for a set period of time, after which the remaining assets are distributed to one or more charitable organizations. By donating appreciated assets to a CRT, you can avoid capital gains taxes and receive a charitable tax deduction.

Another option is a donor-advised fund (DAF). A DAF is a charitable giving account that allows you to make a tax-deductible donation to a public charity and recommend grants to other charities over time. With a DAF, you can donate cash, appreciated securities, or other assets, receive an immediate tax deduction and support multiple charities over time.

Legacy Planning

Legacy planning involves creating a plan for how your assets will be distributed after you pass away. This can include creating a will or trust, naming beneficiaries for retirement accounts and life insurance policies and making charitable gifts. Legacy planning is an important part of estate planning and can help ensure that your wishes are carried out and your loved ones are provided for.

When creating your legacy plan, it’s important to consider your goals for your wealth and how you want to be remembered. Do you want to leave a financial legacy for future generations? Do you want to support causes that are important to you? By setting clear goals and developing a plan, you can create a legacy that reflects your values and priorities.

Life Insurance

Life insurance can be an important tool for charitable estate planning and legacy planning. A life insurance policy can provide a tax-free benefit to your beneficiaries after you pass away, helping to provide for their financial needs. You can also name a charity as a beneficiary of your life insurance policy, which can provide a significant gift to the charity while also providing tax benefits for your estate.

When considering life insurance for charitable giving, it’s important to work with an experienced advisor who can help you navigate the tax implications and ensure that your policy is structured to meet your goals. Depending on your situation, a permanent life insurance policy such as a whole life or universal life policy may be the best option.

Conclusion

Charitable estate planning, legacy planning and life insurance are powerful tools that can help you build a lasting legacy while supporting the causes you care about. By working with an experienced advisor and taking a thoughtful approach, you can create a plan that reflects your values and priorities and provides for your loved ones and your community. At GILKO CAPITAL, we are committed to helping our clients achieve their charitable and legacy planning goals. Contact us today to learn more about how we can help you build your legacy.