Planning matters

A Charitable Giving Experience

Charitable giving is an important part of the financial picture for many of our clients. Whether you have an annual giving plan in place, or want to establish one, our team will help review strategies that might be more tax efficient or flexible according to your wishes. It’s also helpful to understand your role as a donor, talk through different giving options and look at ideas to help get involved with causes you connect with. In today’s blog post we share a story guest written by a client about her charitable experience, and how the Schwab Charitable donor-advised fund account was a great solution for her individual giving goals.

 

When I was planning for retirement, I downloaded a budget worksheet from my 401K provider to prepare for both day-to-day expenses and emergencies. 

One category was annual charitable giving. I’d made donations while I was working but giving wasn’t a priority. I could do that when I was old – or after I died – if there was any money left.

I’d been so focused on saving for retirement I never really considered what would happen if my savings plan was successful. What if I had not only enough to live on, but enough to share?

But a box on a form wouldn’t have changed my perspective if not for another, completely unplanned event. I’d been with my husband since college, and as we looked forward to retirement, we envisioned road trips, novel writing and other adventures. 

Then tragedy struck – he was diagnosed with terminal cancer at age 57. We suddenly had to face mortality, and to consider where we wanted our retirement savings to go as we created our wills and trust documents. Though this was an incredibly painful time, it forced us to have the discussions around our legacies we’d thought we were too young to worry about.

By the time many of us get to retirement age, it’s likely we’ve accumulated various asset accounts, whether through jobs or inheritances or both. When I began working with Johnson Bixby, one of the first things we did was to consolidate those random investments into a Schwab account. 

And that’s when the idea of actively giving really took root. Opening a Schwab Charitable account completely changed my focus and involvement with giving. Even after my husband passed away, I still thought about giving as something that would happen after I was gone, but now I include planning for giving in each meeting with my advisor.

The biggest advantage of the Schwab Charitable account is convenience. It’s easy to move appreciated securities into the account, and my advisor and I look for the most tax-advantageous securities to add each year. Then every grant is equivalent to giving appreciated securities. Making grants is also easy. The minimum grant is $50, and you can set up recurring grants to organizations. Some companies that offer matching programs will match grants given from the charitable account, making your donations go even further. You can also assign a successor to manage the account after your death.

For me, the best part about using the charitable account might seem strange. Once you add funds you can’t get them back – you can only disburse them. That may seem like a downside, but it gives me the freedom to be more generous. After all, I’ve already donated the funds, so I might as well use them for causes that are important to me, and to have the satisfaction of seeing the results of my donation.

Whatever type of charity you choose to support the Schwab Charitable account provides an easy way to accomplish many of your giving goals. 

 

Next time you meet with your Planner, make sure to share your giving aspirations, even if they are only ideas and not defined plans. Together we can help create the legacy you intend.

 

Written By Haley Smart