Easy Estate Planning to Leave a Legacy through Charity | NFCR


Estate Planning to Leave a Legacy

Family Charitable Estate Planning
Often, when I speak of leaving a legacy to NFCR, many donors sigh and talk about the difficulty of sitting with an attorney and revising their will or setting up a trust. Not to mention the family dynamics and costs associated with creating or updating estate planning documents. I understand where planned giving can be a stressful process and difficult decision, but it doesn’t have to be.

A planned gift doesn’t have to involve difficult documentation, high fees, or the involvement of attorney…not that there’s anything wrong with attorneys. A planned gift can be made by simply changing the beneficiary designation on various accounts.

Consider the accounts you own which require a beneficiary designation. Generally, life insurance policies, 401ks/IRAs and, in some cases, savings accounts can have a Payable On Death designation, which operates the same way as a beneficiary.

What does a beneficiary designation accomplish? It’s pretty straightforward. If I own an account with a beneficiary and I pass away, the funds go directly to the beneficiary, regardless of what any other document, such as a will or trust, may say.

Example: My will may leave everything to my wife and children, but if I have my brother as beneficiary of my IRA and I pass away, my brother will receive my IRA funds. There may be some arguing, but the IRA will ultimately pass to my brother.

This is where changing a beneficiary to a charity, such as NFCR, is really the simplest and straightforward way of leaving a legacy. Perhaps I have an old IRA where I’ve been gifting the annual distributions to NFCR for a few years. Maybe you could consider changing the beneficiary to NFCR. The same could hold true for a life insurance policy, brokerage account or savings account as well.

Changing a beneficiary can be as simple as requesting a “change of beneficiary” form or simply going online to your account provider and completing the form there. Even though this is very simple and doesn’t need to be a public discussion, you may save some family confusion if you mention your intentions to your family and/or friends in advance.

Lastly, when designating a charity as a beneficiary, it doesn’t have to be an all or nothing scenario. You can always decide to leave any percentage you please to a charity or even to multiple charities. You can leave 75% of your life insurance policy to your sister and the remaining 25% to NFCR, or any combination you can imagine.

If you have any questions, thoughts or concerns you would like to discuss, I would be glad to have a phone conversation. Please contact Brian Wachtel, Executive Director at BWachtel@NFCR.org to learn more.