Charitable Giving Is an Investment in Yourself and Others

You may be bracing for that early December feeling — a crisp chill in the air, the jingling of bells, and a mailbox overfilled with donation requests from charitable organizations. As an American, you will probably be in a giving mood as the United States is one of the most charitable nations, giving away over $373 billion in 2016. 

The nonprofit organizations that we donate to in order to support our favorite causes are dependent on those charitable contributions. And while the contributions we make are for the greater good, many savvy investors understand that charitable contribution is also an investment. 

Why Donate?

Reasons for donating are as varied as the contributors themselves. Besides furthering the goals of a cause close to one’s heart, charitable giving can soften one’s personal brand, be a touching tribute or legacy for a loved one, or create numerous tax advantages for investors.

A charitable tax write-off sows guaranteed returns, and a lifetime of charitable giving can help with estate planning. There are several ways that a charitable contribution is an investment in one’s portfolio. For example, opening a charitable remainder trust (CRT) may help an investor turn non-income-generating assets and properties into profitable ones. Charitable investments may also fund life insurance, a way to better provide for heirs. Additionally, private foundations offer reduced estate and income taxes; a charitable bequest may reduce gift taxes, and donor-advised funds allow assets to grow tax-free. 

How to Donate — Screening Chosen Charities

It’s the season for giving, but beware. There is never a shortage of scandals involving charitable foundations misusing funds or turning out to be outright scams. As an investor, you want to make sure your dollar is stretched as far as possible, which means fully screening whom you choose to invest in. Luckily, there are more options now than ever for screening the charities of your choice.

  • charitynavigator.org, give.org — Document legitimate charities, including governance and cost-effectiveness. Check these websites to see if the charity you are thinking about giving to is a scam. 
  • The Charity Navigator app — Provides quick reference checks. 
  • myphilanthropedia.org/ — Ranks the most cost-effective charities by cause. 
  • GuideStar — Collects the tax returns of charitable organizations. Here you can see executive compensation, mission statements, and whether any money went to the family or business of the executive, among other charity personnel. 

When to Donate 

For tax savings, there is not necessarily a best time to give throughout the year. However, the urge to give is typically strongest around the holidays. As the holiday season coincides with year-end, this time of year is often best for investors looking to limit their tax burden. 

It is important that you have a charitable-giving plan. Researching the charities that serve the causes close to your heart and working with your financial advisor to develop a plan around your giving will help you maximize the benefit of your donation, both for the organization of choice and for your personal investment.

For a better understanding of how charitable giving can both help your investments and minimize your tax obligations, contact us _____.

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As we head into 2022, Amelia, Amy, and I are thrilled and excited to announce the merger of Howell Financial Advisors with Total Wealth Planning, LLC, based in Cincinnati, OH. We are now the Carmel, IN office of Total Wealth Planning and our office remains at its current location.

ENRICHING LIVES THROUGH FINANCIAL GUIDANCE

I have known the Total Wealth Planning team and their principals for over 12 years, which means we chose the right partners. Total Wealth Planning shares our same personal and professional values as objective, Fee-Only fiduciaries. Our common purpose is to deliver exceptional wealth management and life planning experiences for our mutual clients.

Amelia, Amy, and I, along with the entire Total Wealth Planning team, look forward to continuing to guide you through complex financial decisions that can impact you, your lifestyle, and your family’s financial future. We could not be more pleased about this new chapter in the life of our firm, and also for you, the most valued members of our business.

Learn more about our new venture with Total Wealth Planning and how this will benefit you at:

https://twpteam.com/howell/

As always, we are here for you.

We will see you in 2022!