I am 83, and my wife is 80. We have no children and decided to leave most of our estate to charities we are familiar with. After we are reasonably sure we will have sufficient income for our remaining years, we will give three ways: First, we will provide a modest amount of cash to nieces and nephews (and one or two friends). Second, we will give some money to local charities we know when they are matched. Our IRAs are invested with Vanguard, so to minimize taxes, we use the QCD method to donate to charities. We monitor the amount we give using QCDs to ensure we have sufficient funds for life. We use our home equity loan for any expenses that exceed our income. Finally, our estate will pass to charities using Donor Advised Funds (DAFs). Vanguard Charitable (a DAF) permits one to avoid or minimize taxes and designate when and the amount you give to each charity in a lump sum or annually for a specified period. The DAFs permit us to develop an agreement, in writing, each charity will use the donations charity. Our estate plan clearly defines our wishes. Most of these transactions are fixed in that plan, so we do not burden our Executors. One additional point is that when our home is sold, the net proceeds (sale price minus home equity loans and other debts) will be donated to our DAF and distributed like our Vanguard IRA.
We are comfortable with our plan that 'gives now' plus leaves a legacy for us.
Comments
I am 83, and my wife is 80. We have no children and decided to leave most of our estate to charities we are familiar with. After we are reasonably sure we will have sufficient income for our remaining years, we will give three ways: First, we will provide a modest amount of cash to nieces and nephews (and one or two friends). Second, we will give some money to local charities we know when they are matched. Our IRAs are invested with Vanguard, so to minimize taxes, we use the QCD method to donate to charities. We monitor the amount we give using QCDs to ensure we have sufficient funds for life. We use our home equity loan for any expenses that exceed our income. Finally, our estate will pass to charities using Donor Advised Funds (DAFs). Vanguard Charitable (a DAF) permits one to avoid or minimize taxes and designate when and the amount you give to each charity in a lump sum or annually for a specified period. The DAFs permit us to develop an agreement, in writing, each charity will use the donations charity. Our estate plan clearly defines our wishes. Most of these transactions are fixed in that plan, so we do not burden our Executors. One additional point is that when our home is sold, the net proceeds (sale price minus home equity loans and other debts) will be donated to our DAF and distributed like our Vanguard IRA. We are comfortable with our plan that 'gives now' plus leaves a legacy for us.
Post: When to Give
Link to comment from August 5, 2023