With a little research, a family should be able to find a suitable home for their estate and leave a lasting legacy – whether they are rich, Bill-Gates-rich, or not wealthy at all.

Leaving an ongoing charitable legacy is not just for the wealthy. You do not need to be Bill and Melinda Gates with a foundation that gave away $3.6 billion last year. Foundations offer trustees greater control over investing and distribution of gifts, but they can be expensive to create and maintain, with strict compliance rules.

However, one idea from a recent Timearticle, titled “Give to Charity Like Bill Gates…Without Being Bill Gates,” is to amend your trust so that upon your death your funds go to a DAF-a donor-advised fund – a type of investment that manages contributions made by individual donors. With a DAF, you could map out a lasting legacy of continued giving beyond your own life. Also, since there is no organization named in the trust documents, you can change your mind about what charities you want to benefit.

DAFs are a simple and relatively low cost alternative with a built-in advisory board which makes them an ideal instrument for securing a financial legacy. Unlike foundations, there is no cost to create, and there are some tax advantages. The IRS allows greater tax deduction for gifts of cash, stock, or property to a donor-advised fund, compared to a foundation. Foundations must give away 5% of their assets annually; there are no distribution requirements for DAFs.

The original article explains that all DAFs have a board of directors, and many are willing to maintain the gifting goals of a donor after their death and insure that the recipient charities are eligible for annual grants. You have many options, and DAFs come in a variety of shapes and sizes. Independent brokerage firms have their own funds with minimum initial contributions typically as low as $5,000.

You can easily find a suitable home for your estate and leave a lasting legacy with the help of an estate planning attorney. Make an appointment today.

Philip J. Kavesh
Nationally recognized attorney helping clients with customized estate planning guidance for over 40 years.
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