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Reprinted By Permission - Copyright - ORIGINALLY POSTED 2002
Boulder Daily Camera
Making Money Matter
Enid Ablowitz

Legacy Giving Without a Will
By Enid Ablowitz,

Rotary encourages legacy giving, and providing a bequest or naming Rotary as the beneficiary of insurance or retirement plan assets it is a wonderful way to support the organization that has been so much a part of your life. When you no longer need your wealth, share a portion of it and make a Rotary difference.

Last fall, I was asked to participate in a program sponsored by a local organization that wanted to begin raising an endowment. The idea was to bring together a group of people who cared deeply about the organization, its past and its future, to discuss a fundraising campaign that would link the idea of bequests to the idea of endowments, and that would encourage people to name the organization in their wills.

The first part of the presentation was about the motivations for giving, the second part was focused on how endowments support an organization in perpetuity, and the third part of the presentation talked specifically about bequests. What I found particularly interesting was the Q&A where there was a lively discussion about the process of creating or modifying a will.

What I learned was that, while many people have significant charitable intent, especially when they no longer will need the assets, there is a great deal of angst surrounding the contemplation of and process of writing a will, and particularly, the costs of doing do.

There were several attorneys in the discussion group who reinforced the need for a will, and the important considerations addressed in such a document, but the “simple” act of making a bequest brought about a complex discussions of trusts, taxes and the like. While I’m not an attorney, and I will always suggest that donors seek legal advice when appropriate, what I learned is that simple ways of giving at death without a will, are often not part of the dialogue of estate planning.

You don’t need a will to make a charitable gift through a beneficiary designation in an insurance policy or retirement plan.
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Insurance policies allow the owner to designate ‘who’ should receive the proceeds upon the death of the insured. Many people assume that only “heirs” can be named. Charitable organizations can be named as well. In fact, if a charity is named as irrevocable beneficiary, the donor can receive an income tax deduction for the premium payments. If the policy is paid up, the insured can give away the policy and get an income tax deduction for its value, which may be approximately the cash value of the policy. (Most attorneys would advise you against having your estate as beneficiary of your insurance policy, since the proceed can pass outside a will.) I wonder how many potential donors have old insurance policies they no longer need (like GI insurance, for example) that could make a terrific end-of-life gift to a favorite charity!

You can also create a charitable beneficiary in your IRA or retirement plan. There may be tax consequences if your estate is taxable, but they would generally be favorable. Again, this may be a simple way to create a charitable gift at death without having to change your will, and in fact, if you do have a taxable estate, these may be the most cost effective assets to use for charitable giving.

Perhaps one of the simplest mechanisms for making a charitable gift of assets that are no longer needed is a savings account with the “POD” registration. POD stands for “payable at death.” Talk to your banker about this easy option.

When all is said and done, if you have charitable intent, there are easy ways to give. The beneficiary designation is an easy way to make a legacy gift. Don’t want to write or change your will? Change your beneficiary designation to include your favorite charity!

Enid Ablowitz is the Vice President for Advancement at the University of Colorado Foundation, Inc., and Director of Advancement for the Coleman Institute for Cognitive Disabilities. She has been working as a donor advocate for more than a dozen years. Her book, Making Money Matter: Eight Steps to Thoughtful Giving has just been published. For information on how to obtain a copy, contact her at enid.ablowitz@hotmail.com.

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