When you are involved in the process of estate planning you may decide that you would like to spread some of your assets around to worthy charitable causes. This is a good way to foster a philanthropic legacy, and some people can do this quite efficiently as they reduce their tax exposure.
There are various different ways to give to charitable causes. Obviously you can do it directly while you are still alive. You can also set up a private foundation, and you actually don’t have to be a billionaire to do this. Most private foundations in the country are not staffed, and the majority of them are working with less than $1 million in funding.
Another charitable estate planning option would be to contribute assets into a donor advised fund. With these funds you deal with just one entity, but you can ask the fund to distribute grants to a number of different charities.
One of the advantages is that you don’t have to deal with multiple entities. This simplifies your accounting, and donor advised funds will accept contributions of appreciated securities. It is possible that one or more of the charities that you would like to support are not set up to accept them.
When you decide to give to charitable causes, you may want to gain an understanding of the way that charities are managed. Some are very efficient with a high percentage of their budgets going to provide programs and services. Others are much more top heavy with high executive salaries and tendencies toward lavish fundraising efforts.
A good resource to utilize if you want to research charities is a website called CharityNavigator.org. This site puts thousands of charities under the microscope, and you would do well to get the facts before you make your final decisions.