Posted January 1st, 1997

Where There’s a Will There’s a Way… or is There?

For the majority of major gift planning programs — whether well established and sophisticated or relatively new and looking for the right mix of efforts — simple bequests through wills rank as the number one source of new gift expectancies and maturities. This is not news to institutions and organizations who continue to include bequest marketing as a program staple. However, as the inter-generational transfer of wealth accelerates, gift planning executives may want to carefully consider that old saying, “where there’s a will, there’s a way,” and determine whether the statement is always true.

Results of recent studies tend to validate the wisdom that lies at the root of the slogan. For example, in one report that polled wealthy individuals, the majority responded that they are considering the inclusion of charitable institutions in their estate plans.

Couple those intentions with reports indicating that fewer than half the adults in this country leave a will and the potential for harnessing that donative intent with information-oriented marketing efforts becomes apparent. And when the transfer of wealth mentioned earlier reaches its peak, you certainly want your organization positioned advantageously with individuals who hold your cause in high esteem.

Reality strikes

In reality, however, complexities often override such simple logic. Many people have long believed that charitable gifts at death are made only when directed by a specific bequest in a will. But, consider the following avenues

  • Revocable living trusts
  • Life insurance/retirement plan assets
  • Joint ownership arrangements

Each of these planning vehicles shares the inherent capacity to pass funds to nonprofits at death. Property passes at death (assuming that the property has not otherwise been disposed of or consumed) by one of three methods: valid will, other legal arrangements, or state laws of descent and distribution.

Living trusts, life insurance policies, retirement plans, and joint ownership fall within the category of “other” legal arrangements. These other types of “bequests” or “legacy” gifts may actually prove simpler and less expensive to arrange than creating a new will.

Expanding horizon beyond “wills”

Gifts of life insurance or retirement plan assets, like bequests or revocable living trusts, can usually be changed at the donor’s discretion. Even many survivor- ownership arrangements commonly associated with bank accounts or certificates of deposit that are designated for distribution to nonprofits at death may easily be changed during life.

These assets, already in place, may afford potential donors an opportunity to transfer funds at death in ways better suited to their individual estate plans. And, many are more aware than ever before of the variety of estate planning tools available to them and how to leave remainder gifts to causes they support.

Your familiarity with these alternative “bequests” from other simple remainders may present you with the opportunity to tap into the good intentions of those who are considering making charitable gifts from their estates.

The publisher of Give & Take is not engaged in rendering legal or tax advisory service. For advice and assistance in specific cases, the services of your own counsel should be obtained. Articles in Give & Take may generally be reprinted for distribution to board members and staff of nonprofit institutions and other non-donor groups. Proper credit must be given. Call for details.

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