Issue link: http://publications.winnipegfreepress.com/i/1241346
L E AV E A L E G A C Y ™ M a k i n g a D i f f e r e n c e i n t h e L i v e s t h a t F o l l o w 5 MAKING A DIFFERENCE after you're gone By Mark Halsall Giving is a deeply personal act that often comes from the heart, and many gifts are driven by long-term, thoughtful considerations. M any Manitobans are inspired by the idea of making a difference for future generations, which is likely one reason why legacy giving is on the rise in the province. Legacy giving, also known as planned or estate giving, enables individuals to continue to aid causes that are meaningful to them during their lifetimes after they've passed away. As more people opt to support their favourite charities this way, there's also been a change in way many of them are doing it. "Historically, estate gifts left to charities tended to be undesignated, leaving the discretion for use of the gift, to the charity receiving it," says Pat Lilley, chair of the Manitoba chapter of the Canadian Association of Gift Planners (CAGP). "Today, we are seeing a shift. Increasingly donors want to be more engaged and direct the use of their gifts. There is a growing interest in gaining a deeper understanding of a charity and a demonstrated impact of gifts to the organization," Lilley adds. "We are already seeing more designations in estate gifts." Lilley says one explanation for this heightened interest in designated giving is that donors may feel affinity to a specific program offered by a charity, especially if it's been very impactful on them and their family. Lilley believes it's a trend that will continue to pick up steam in the future with the rise of social influence as a motivating factor in charitable giving. "Social influence is an area where growth is anticipated, particularly with the next generation," she says. "Young people are finding community through causes they care about, and often activate participation from others as they do." Lilley points out that while registered charities can benefit immensely from designated gifts, it shouldn't be overlooked that estate gifts that can be used at a charity's discretion play a hugely important role. "Undesignated gifts, by virtue of giving the charity the broadest use for that gift, can help charities shore up specific areas where they may be lacking support," she says. The notion of making a difference for future generations isn't the only reason, of course, that people choose to make charitable gifts. Some people, for instance, are motivated to give back when they've been financially successful, while for many, the tax benefits associated with legacy gifts are a primary consideration. Strategic giving to a registered charity will reduce taxes to the donor's estate, meaning more money can be distributed to the other beneficiaries. Lilley notes there are number of different options for making a deferred gift. These include a bequest, life insurance, retirement fund accumulations, charitable remainder trusts, and gifts of residual interest. "If your legacy giving includes a gift to a charity, it is also important to communicate with the charity about your intentions, to ensure it can accept the type and purpose of deferred gift you are considering," she says. Lilley stresses that communication between family members is also key when determining where and how legacy gifts are to be distributed during the estate planning process. "Our professional experience shows us people may not be sharing with their heirs how or when they plan to pass on their wealth," she says. Lilley recommends that parents and grandparents take the time to discuss financial decisions with their families during their lifetimes, so that their loved ones can continue to support their legacies. "There can be an assumption made that the children will understand what their wishes and expectations are. But unfortunately, that's not always the case," she says. "The topic of inheritance is an important issue requiring clear communication. I would almost compare it to pre-planning your funeral. It's something that's difficult to talk to your loved ones about, but you're actually helping them by doing it and alleviating some of that burden." ❚ PHOTO BY DARCY FINLEY Pat Lilley says an increasing number of donors want to be more engaged and direct the use of the gifts they provide to charitable organizations.