The Planned Giving Primer with John Archer
Planned Giving is an increasingly popular philanthropic strategy that allows donors to reap tax and other financial benefits while supporting the MUHC’s dedicated doctors, nurses, professionals and staff. Over the coming months, Health Perspectives will speak to different financial professionals about how various planned giving vehicles can meet the needs of a range of donors.
In the first installment of the Planned Giving Primer, John Archer, investment advisor with RBC Dominion Securities and chairman of the MUHC Foundation’s Planned Giving Committee, explains some of the basic concepts of gift planning.
What exactly is planned giving?
JA: Planned giving is all about making a charitable gift in such a way as to maximize the tax and financial benefits that philanthropy offers. To do this, planned gifts are made in consultation with financial experts as part of your overall financial or estate plan. These gifts may be one-time donations, a series of payments over a set period of time, or ongoing support for the charity of your choice. They may be immediate gifts for use today, deferred gifts for use in the future or a combination of the two.
In other words, planned giving takes a variety of forms. But no matter what vehicle you choose, planned giving is designed to allow you to make the most of your charitable resources while offering you valuable tax advantages or even an annual income. I like to say to my clients that planned giving is a partnership: it is meant to support you while you support your cause.
What are the different ways of making a planned gift?
JA: While bequests account for a large percentage of planned gifts, there are many other options available to donors. These include gifts of life insurance, real property or publicly listed securities, or even using a gift of cash to purchase a charitable gift annuity.
Each planned giving vehicle offers particular advantages, which can be explained in detail by your financial advisor. To give just one example, the government’s elimination of the capital gains tax in 2006 on donations of appreciated securities – including stocks, bonds and mutual funds – has made this an increasingly appealing option for donors who have seen large capital gains in their portfolio.
The MUHC Foundation can provide more detailed information about how the different planned giving options work and what benefits each of them afford. I think the most important point to keep in mind, however, is that the flexibility of planned giving means that almost anyone, no matter their age or means, can consider making a donation of this kind. After all, planned giving does not require great wealth, just sound financial planning.
How does a donor know which planned giving vehicle is the right one?
JA:The decision to make a planned gift is a very personal one. It depends both on your financial situation and your charitable goals. Every donor has different needs and goals. To take advantage of the financial benefits available it is important to match the correct planned giving vehicle to your specific financial circumstances. It is always recommended that you contact your attorney or personal financial advisor to fully understand the financial implications of your intended gift.
The MUHC Foundation’s Planned Giving Committee is here to answer questions about choosing the right planned giving vehicle. Please contact Dolly Shinhat-Ross, the Foundation’s Planned Giving Officer, at 514-931-5656 for more information.
