Saturday, September 11, 2010

November is LEAVE A LEGACY® Month

What is "Leave A Legacy"? 

Chances are, you already donate a generous portion of your income to the non-profit organizations of your choice, such as your synagogue, Federation, Jewish Day School, or even a non-Jewish charity. But have you considered including those organizations in your will - so that you can continue to make a difference for generations to come? LEAVE A LEGACY® can help you start this rewarding process.

Americans are the most giving people in the world. Almost three quarters of us make regular charitable donations while we are alive. It is even more astonishing, therefore, that less than 6% make charitable bequests (i.e. gifts though their will or trust) when we pass on. "LEAVE A LEGACY®" is a community‑based effort that encourages people from all walks of life to make a charitable bequest or other planned gift to the nonprofit organizations of their choice. It is one of 141 such initiatives in the United States and Canada. LEAVE A LEGACY® of Miami-Dade is a project of the Partnership for Philanthropic Planning of Miami‑Dade County which:
  • helps nonprofit organizations implement planned giving programs and spread the word about philanthropy (“Turning donors into benefactors”)
  • educates professional advisors about planned giving and philanthropy ("Making the ask; getting clients to do the right thing")
  • promotes planned giving and philanthropy to the general public ("Everyone can be a philanthropist")
Why Should I Care?

For Jews over the centuries, “leaving a legacy” has meant passing aspirations and values to the next generation. Today’s wills evolved from what we now call ‘ethical wills,” which served to pass on legacies when Jews were barred from material wealth. Today we live in a society in which wealth can be used to leave a legacy on a scale heretofore unknown.

It is wise to hope for the best but plan for the worst, or at least the inevitable. It is still wiser to constantly remind ourselves that wealth perpetuation is only a tool to help our values live on. Although 10 Jews in a room typically have 11 opinions about most things, we all agree that Tikkun Olam – making the world a better place than we found it – is a quintessentially Jewish concept. By encouraging planned gifts, LEAVE A LEGACY® implements Tikkun Olam on a universal basis.

What are “Planned Gifts”?

Whether it’s the Yom Kippur appeal envelope, Federation pledge card or tree in Israel, most of us associate charitable giving with writing a check, or using a credit card. In short, giving right now, with cash or its equivalent. In the nonprofit parlance, it’s called “annual giving.”

Many people are wealthy “on paper” but (relatively speaking) cash poor. Much of their wealth is concentrated in assets – real estate, art, small businesses, qualified retirement plans, etc. -- which are illiquid, unmarketable, low basis or otherwise unsuitable for converting to cash or passing to the next generation. Planned giving is the art – and mitzvah – of converting these assets, sometimes into an income stream, sometimes avoiding income, capital gains, gift or estate taxes, sometimes immediately, sometimes in the future and sometimes upon death, but always, always into a charitable legacy.

From the point of view of the synagogue, Jewish day school, hospital, social service or cultural organization, planned gifts create endowments and other pools of funds, allowing them to achieve their long range vision. Planned gifts are a bridge to the future.

Why Is a Program like "LEAVE A LEGACY®" Needed?

According to the Chronicle of Philanthropy, the September 11 emergency relief effort exceeded $1 billion within a couple of weeks. The terrorist attacks were a grisly reminder of how interconnected we are, and we responded with a record – breaking outpouring of financial support. However, local charities, already whipsawed by a recession and federal budget cutbacks, saw a commensurate reduction in contributions. Unfortunately, there was no commensurate reduction in the amount of poverty, hunger, homelessness, crime, unemployment, illiteracy, incapacity, domestic abuse, substance abuse, and barriers to education, culture and opportunity. An important focus of this year’s LEAVE A LEGACY® campaign is to remind South Floridians that now, more than ever, charity begins at home.

How Does "LEAVE A LEGACY®" Work?

LEAVE A LEGACY® does not solicit gifts for any particular organization. Instead, the program is a cooperative effort of all types of South Florida nonprofit groups including social service and arts organizations, synagogues, hospitals, educational institutions and other philanthropic groups. The LEAVE A LEGACY® campaign provides resources to nonprofit groups and professional advisors, to urge their clients, donors and members to make a will, make a difference, and leave a legacy. Joining together the charities, the financial and estate planners and the media has proven to be an effective way to increase general charitable giving through trusts, wills and estates.

A Planned Gift to Your Favorite Charity: Receiving while Giving
The Zohar teaches us that the more we give, the more we receive, referring to the spiritual benefits of giving. A somewhat more pedestrian source of benefits is the Internal Revenue Code, which contains a plethora of ways to avoid or defer avoiding income taxes, capital gains taxes, gift taxes and estate taxes while benefiting the charity of your choice. Perhaps even less known than the mysteries of the Zohar (or of the Internal Revenue Code) are the ways in which these arrangements can be structured to transcend mere tax savings and achieve your personal goals consistent with leaving a legacy, such as protection against:
  • creditors
  • predators
  • bad judgment
  • divorce
  • “Affluenza”

In future columns we’ll explore ways to meet your financial and charitable goals and coordinate the control of your social capital with charitable trusts, charitable gift annuities, supporting organizations and family foundations by turning unproductive assets into productive ones and even by giving away the IRS' money

Where Do I Start?

Before even thinking about ways to structure planned gifts, become educated about the many organizations which promote Jewish continuity, provide a place to worship, educate our children, care for the infirm, support a secure and thriving State of Israel, and otherwise carry out Tikkun Olam. Becoming involved with your local charity is your first step toward leaving a legacy.

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