Being Intentional About Charitable Giving

BlogFinancial Plan D Barker

Does your financial plan include giving? The question sounds almost like an oxymoron. After all, isn’t financial planning about accumulating money? Certainly, we want to support our families and protect against unforeseen expenses, but Canadians are also well-known for our generosity. We love to help others by giving our time, talent and resources. There is no doubt spontaneously responding to an urgent emergency appeal, donating to local fundraisers, or texting a donation to a charity is a good thing. However, when we approach giving as part of our financial planning we not only benefit the charity, but we also create benefits for ourselves that are beyond the bottom line. So where do we start?

1. Renew Your Mind

Giving doesn’t begin with having a certain amount of money, it starts with our hearts and minds. Making giving part of our financial planning requires us to reframe giving as a priority commitment that adds value to our lives, like an RRSP investment or life insurance.

As a young couple in 1953, John and Katie Penner put this thinking into action. They didn’t have a lot of money, but they made giving a priority. “We didn’t know how to live an expensive life; however, years ago, Katie and I made an agreement to give while we are alive,” explains John. They started small, but over the years as their circumstances changed, they slowly increased their giving. Now 89 years old, the Penners have never swayed from their decision to make giving a part of their financial planning. Today, they have established a Gifting Fund™ that family members also contribute to. Collectively they decide which charities to support. “We give to about fifteen different charities because we want to support them.”

Being intentional about charitable giving by making it part of your financial planning doesn’t have to begin with large amounts money. Simply taking small steps to give what you can each month into your Gifting Fund can have a massive impact over time.

"Giving doesn’t begin with having a certain amount of money, it starts with our hearts and minds. Making giving part of our financial planning requires us to reframe giving as a priority commitment that adds value to our lives." -… Click To Tweet

2. Set a Goal

Planned giving is much easier when we have a goal. Most of us have several financial goals already: retirement, our children’s education, life insurance, and savings. These goals help us to ensure we have enough to care for our needs now and in the future. Setting a giving goal is no different. We examine our finances and, based on all the variables, determine a certain amount that we would like to give away.

Everyone’s financial goals will be different. For example, the Wilson family from Southern Ontario made the inspiring decision to donate 20% of their income to charity every year. Of course, not everyone has the capacity to do this, but the Wilsons were able to budget and meet all their needs on the remainder of the balance. No matter the amount of our charitable giving goal, the most important thing is to set one. Then we can approach it slowly but surely, gradually increasing the amount of our giving as we are able until we reach our goal.

3. Start a Gifting Fund

Whether we are a kid wanting a new toy or a family hoping to go on an extravagant vacation, we all know that it’s best to save in advance rather than increasing our debt load. The same logic applies to our charitable giving, and it starts with establishing a savings account for the money we plan to give away. Many charitable giving funds even allow you to contribute by automated debits, and payments can be set up to coincide with payday so the money is given before it’s even missed.

When the Penner family opened a Gifting Fund with Abundance Canada, it allowed them to conveniently contribute to their charitable giving every month. These manageable monthly donations accumulated over time, and before long they were able to make a much more impactful donation to their favourite charity than they initially thought they could.

4. Consider a Generosity Plan™

Planned giving is not static – it changes and evolves as we move through the various seasons of life. Establishing a Generosity Plan allows us to maximize our assets as effectively and efficiently as possible as time moves on.

As we gain more financial security, expanding our giving to include life insurance or gifts of securities not only offers tax benefits, but may open the door for other giving opportunities. Likewise, as we enter our golden years, will and estate planning provides opportunity for charitable consideration. Adding your favourite charities as beneficiaries in your will not only ensures a legacy of generosity but may also provide tax savings.  Whatever season of life you’re in, a charitable giving service, like Abundance Canada, can help you establish a planned giving strategy that’s right for you.

Making giving part of your financial plan has many tangible benefits, but some of the most valuable returns are the ones we can’t see. Intentionally prioritizing charitable giving keeps our focus on the needs of others rather than ourselves; it encourages us to live on less and be grateful for what we have; it can help us explore and discover causes we are passionate about; and it sets an example for those around us.

Establishing a lifelong legacy of generosity begins with a simple decision to start. So, does your financial plan include giving?

David Barker

David Barker is a Gift Planning Consultant with Abundance Canada. For nearly 50 years, Abundance Canada, a national, public charitable foundation has been helping Canadians to be more generous now and through their estate. For a confidential, free and no obligation consultation, contact us to learn more.

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