Approach to charitable giving

medved

Recycles dryer sheets
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Apr 10, 2016
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311
We give relatively modest amounts to charity each year, compared to our assets. (I am sure we give much more than most people give, in absolute terms -- but not very much as a percentage of what we have accumulated). However, we will give substantial amounts upon our death. For the most part, this is because I am risk-averse. So I feel more comfortable keeping most of what we have, just in case we need it -- even though the odds of that are quite small -- and then being substantially more generous with the funds that "it turned out we did not need." (We do have kids, but they should not need everything that we are likely to leave over -- and big inheritances can have some downsides as well as benefits).

I realize this is just a matter of personal preference -- and without any "right answer" -- but I am interested in how others who have accumulated substantial assets think about the balance between giving during your lifetime and bequests.
 
I am in your camp. I don't plan to run out of money, but you know what they say about plans. We don't have children so it is very likely a large amount of our estate will go to charity.
 
I think most here prefer plenty of financial margin, as do I. So your idea of keeping it if needed then leaving charitable bequests in a will probably resonates with many, including me.

I think QCDs are a great way to do charitable giving. Later in life it might be easier to agree that one has won the game to great excess and QCDs have great tax benefits. If one is too young for QCDs then DAFs are also a nice way to give.

On the other side of your main argument, I do derive some joy from annual giving. So I have chosen to integrate it into the tempo of my life by scheduling my gifting. Now every year during the December holidays, I sit down with my kids (and sometimes their current girlfriends or boyfriends) and work with them to select charities to give to from a list I curate year round. Then, shortly after New Year's, I sit down and give to those charities in their honor. That's also when I do my annual gifting to my kids.

I try to increase both the annual gifting and charitable gifting amounts somewhat each year. To make this easier on myself, I force myself to look back at how much my net worth has increased over the previous 12 months. In the odd year (like 2022) where my net worth goes down, I then look at my raw net worth and usually the annual giving amounts are a very small percentage of my net worth.

I hope that gifting like that on a regular basis will demonstrate to my kids that they can and should be charitable as well. That may be wishful thinking, but I figure what I'm doing is better than nothing in that regard.
 
Roughly 10% of our spending each year goes to charities. Nothing like tithing or the equivalent; it just works out to around that percentage.
No relatives who could benefit from more money, so whatever is left will all go to charities in the end.
As time goes by, I may make a few large gifts to a few of them, but too soon to say that yet. As Gumby points out, the best laid plans...
 
I withdraw way more than I need every year- it's sustainable because my invested assets have increased 3%/year on average after withdrawals since I retired 10 years ago. Like others here, I err on the side of caution because I don't want my only child and his wife scrambling to find me a nursing home that takes Medicaid.

About 40% of what I spend in a year is travel and charity. I have a large church pledge and then allocate some of my monthly budget to charity. If there's money left at the end of the month I may add more to the charity budget. There's so much need out there (and we all have different priorities- nature, poverty, education, the arts, etc.) and it's a joy to be able to contribute.
 
We give relatively modest amounts to charity each year, compared to our assets. (I am sure we give much more than most people give, in absolute terms -- but not very much as a percentage of what we have accumulated). However, we will give substantial amounts upon our death. For the most part, this is because I am risk-averse. So I feel more comfortable keeping most of what we have, just in case we need it -- even though the odds of that are quite small -- and then being substantially more generous with the funds that "it turned out we did not need." (We do have kids, but they should not need everything that we are likely to leave over -- and big inheritances can have some downsides as well as benefits).

I realize this is just a matter of personal preference -- and without any "right answer" -- but I am interested in how others who have accumulated substantial assets think about the balance between giving during your lifetime and bequests.
We don't have kids, I have a married sister with a debilitating disease, a nephew and wife with a new baby as of yesterday. My wife no longer has any family save for distant cousins that we no nothing about. Our NW is in the high 7-figures. We'll be donating between $150k-$200k this year via our DAF plus the RMD's from our t-IRA's and inherited IRA's via QCD. Should be somewhere around $300k-$350k in total to dozens of charities. Our estate after the second death takes care of my sis, her husband, my nephew/neice and will be modified to include the baby.

We live simple and modest lives and want for nothing. Absent a collapse of the market and society we have more than we can possibly spend/need in what remains of our lifetimes. We enjoy giving and are blessed with the ability to do so.
 
We have a Donor Advised Fund (DAF) so that money has already been donated, and we give grants each year from it.

Once we reach the age QCDs from our IRAs will be used as well.
 
While working we decided that $0.15 of every $1 we spend would go to charity. Also, while working, we put a lot of money into a DAF in very high tax years. Now that we are retired, we give a fixed dollar amount every year from the DAF. I'm still a long way away from being able to do QCDs.

I believe living a charitable life is important. I'm not too concerned about leaving our children money. I would rather donate to charities while we are alive. We have settled in on supporting local organizations that we can see their impact in our community.
 
I give a fairly large percentage of my income each year to charities (probably 20% or so). I do it mainly through my IRA. I give mainly to local charities I am involved in and want to see the fruits of what I give while I am alive.
 
I hope to leave a lot to charity but I prefer to "give with a warm hand." I like to see my donations having an effect in my life-time. I only give to small charities with which I have direct communication. I leave the charities like Red Cross or St. Jude, etc., to others. The "big" charities are great and do good w*rk. I simply want a personal relationship with my charities. All my charities are an email or phone call away from the principals. If I have a question or they have a need, the communications are personal and immediate.

Gifting to charities is very much a personal decision and is therefore a YMMV situation.
 
I dump assets in our DAF up to the deduction limit. We use the DAF liberally for a handful of charities each year. Have not started RMDs yet. All our assets will go to charity when we croak.
 
This is a great thread and love to see how everyone is choosing to donate. We are certainly charitable and enjoy giving to one specific charity that is very meaningful to us.

We will set up a DAF in a tax year with a liquidity event from an employer. After that I'd like to level up the donations a bit more.

Also agree with many here that we still lean to ensuring we have enough, before we get extra generous!
 
Donating can be a time thing too. We balance monies and time, probably 50/50 gut calculation. Also % of income is a loose calculation depending on what you consider income.

IMO, giving starts at home and we give to the GKs 529 and MIL's assisted care costs (about 3-4% for us). Then there charities & church (about 10% for us), but this includes a time value for us. Anything else is small #s...

We are still w*rking...
 
I set up a DAF with some appreciated stock from Mega-Corp just prior to the tax law changes. The gains in it have somewhat made up for the yearly donations (outflows). I might do another set of donations to it either this year or next. When I get there, I believe some of my RMD will be in the form of a QCD.
 
Donating can be a time thing too. We balance monies and time, probably 50/50 gut calculation. Also % of income is a loose calculation depending on what you consider income.
I'm very big on giving time, especially since retirement. I've joked that now that my time and expertise are free, everybody wants me to lead things! The organizations that get most of my donations are the ones where I'm involved enough to see up close and personal where the money goes and how it's run.

Most interesting volunteer opportunity so far: I'm on a committee to narrow down the slate of candidates for our next Diocesan Bishop. We need to choose 3 or 4 and Convention delegates will then vote in November. Interviews, discussions, reference checking- next comes a 4-day retreat where we meet them in person. It's good to be able to devote the time and thought needed for something this important.
 
Today I hand carried a check from a small part of my RMD to a local cat rescue that I have been donating to with food and litter for a number of years. It was only $5k but from their reaction you would think it was much more. It was the first time I used a QCD donation and I wanted to do a trial donation to see how it worked. As long as everything goes smoothly with this year's tax returns I plan to at least triple the donation for 2025.
We have enough to see us through without getting nervous and still have a healthy inheritance to pass on to the grown children. In the meantime I'm going to enjoy donating to this charity.
 
We are more modest on the income/asset profile than many members: Annual income (2024) will be $128k [CalPERS of $75k and SS of $53k] & assets are just $1.3 of which $580k us the house free and clear, ZERO debt.

We choose to donate around 8-10% of our income annually. It just feels about right. Just turned 70 in April, so in a few months I WILL switch some of our charity to a QCD. Makes sense.
 
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