It is not unusual for those making charitable donations to have concerns. Consider, for example, the case of a person wishing to make a legacy donation to one or more of his or her favorite charities. Typical concerns may be as follows:
How quickly will the money be spent? It is not uncommon for donors to want to create a legacy — to provide support for years to come, or even in perpetuity. The donor may feel some apprehension with respect to providing a charity with a lump sum, with the freedom to spend it without any control. A preferred option may be to have the money invested, with an annual amount going to one or more charities.
In such a case the donor may want to have some input as to how their donation is invested.
A donor may have a number of preferred charities today, but may wish to have some flexibility to look at other options in the future.
A donor may wish to have some input as to how donations to a charity are used.
There are a number of ways to deal with these concerns, but in many cases the solutions are complex and expensive, and require significant administration.
An alternative may be to consider a Donor-Advised Giving Program. Offered by a number of Canadian institutions these programs simplify much of the legal, accounting and administrative issues involved in setting up a charitable foundation, and in the process provide a simple and effective way of addressing the above-mentioned concerns for Canadians wishing to support their favorite charities.
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Jim Grant, CFP (Certified Financial Planner) is a Financial Advisor with Raymond James Ltd (RJL). The views of the author do not necessarily reflect those of RJL. This article is for information only. Raymond James Ltd. is a member of Canadian Investor Protection Fund. Call Jim at 250-594-1100.