As you draw up your estate planning documents, you will likely face the question of how much you want to donate to others. There is no right or wrong answer, as this is a highly personal decision — possibly more reflective of your own personality than the money you leave to children and family. So, how can you decide on the right number? Here are five key questions to help you.
1. Is Your Estate Sufficient?
First, not everyone has the option to leave significant amounts of their estate to charity, and that's okay. You should take care of those who rely on you for financial support and those whom you love. You may also need to consider things like repayment of your own necessary debts, funeral and final costs, and payments for the execution of your wishes. Once these important tasks are handled, then it's time to assess what you want to donate.
2. How Do You Normally Give?
Estate plans should continue your lifelong pattern of interests, albeit likely in a much larger way than normal. If you have a habit of giving to certain charities or causes over the years, continue this type of giving in your estate plan. Looking back on past giving amounts provides a guiding number as to how much you may want to give in relation to the size of your estate.
3. What Legacy Do You Want?
Your estate planning is the last chance to leave a legacy. That legacy, though, depends on what you want to be remembered for. Your legacy may be your children — in which case you probably don't want to shortchange them in order to donate to strangers. If you want your legacy to be a public charitable one, though, look for ways to make the maximum impact, perhaps by giving one large gift rather than a few small ones.
4. How Will Heirs Feel?
Many people with spouses and children take into consideration how their heirs will feel about their charitable plans. Will heirs feel left out or shortchanged? Will your actions increase conflict between them? If so, you may want to talk with them in advance about your plans or find other ways to give to charity — perhaps while you're alive instead.
5. Do You Want Ongoing Giving?
If your estate is significant, you have options as to how to donate after passing. Charitable trusts, foundations, and other legal vehicles not only protect money for donation but also help grow it so that you can donate more than once. Trusts provide tax strategies and protect funds. A foundation provides more options for donations in the future. It can also involve others, such as your heirs, in giving. If you have special plans, these can make them happen.
Answering these important questions will help you craft a personal plan for charity and giving both during your lifetime and after you're gone. Learn more about all your choices by meeting with an estate planning attorney in your state today or by visiting a site such as https://www.linskylaw.com.