The good that can be done through philanthropy and giving is nothing short of inspirational. For example, during the pandemic, James and Louise Temerty donated a landmark gift of $250 million to the University of Toronto to support advances in health science, healthcare innovation, and health education. Such generous donations set a powerful example for us all. 

While you may want to follow suit and fund a cause close to your heart, clearly it is not within the means of most Canadians to give a landmark gift to charity. However, it is probably possible to give back through your estate. Using a will or other testamentary instrument, you can make a charitable donation with your remaining assets, or even a portion of those assets. For example, SickKids’ website notes that “even a gift of 1% of your estate can make a difference.” 

There are so many upsides to including a charitable donation (or donations) in your estate plan. To name a few:   

– Giving back can make a powerful difference to the work of a charitable organization. For example, donations can increase the number of people a charity can assist, impact the scope of research that an organization can undertake, or enable a movement to tackle social injustice.  

– Donating to a cause you care about is an excellent way to demonstrate, and even memorialize, your values. 

– Including charitable gifts in your will alongside gifts to family and friends can serve as a potent example of philanthropy and encourage further giving after you are gone.  

– Such gifts will reduce, and may even eliminate, the amount of money your estate has to pay to the government via taxes, as noted in last week’s blog post, The Tax Benefits of Charitable Gifts in Wills.  

– A charitable gift can serve as a legacy, as a meaningful way of saying “I was here.”  

According to Will Power, a national public education initiative focused on inspiring Canadians to donate through their wills, currently only 5 percent of Canadians donate to charity through their estates. The goal of Will Power is to raise that level of charitable giving to 8.5 percent of Canadians by 2030.  

Not only is this goal admirable, but it is also very attainable. There are many ways a person can incorporate charitable giving into estate planning, including:  

– Leaving a gift in a will, such as a specific bequest or a residual gift. 

– Gifting a life insurance policy by naming a charity as the beneficiary. For more information about this option, see Will Power’s article, Use Your Life Insurance to Change the World. 

– Donating registered funds, such as RRSPs, RRIFs, and TFSAs, by, again, naming a charity as the beneficiary. Such a beneficiary designation can be made through a will, or using a change of beneficiary form. To learn more, see Making Your Mark with a Gift of Registered Funds. 

– Creating a charitable remainder trust. This would be a good option for someone who wishes to put money in trust for the use of others – any remaining trust assets could be donated to charity when the trust terminates.   

– Donating a residual interest in property, such as land, a home, or an art collection, to charity. By gifting a residual interest, the donor can retain the property and use it during his or her lifetime or for a set number of years before it passes to the donee.   

In the words of John F. Kennedy, “[p]hilanthropy, charity, giving voluntarily and freely… call it what you like, but it is a jewel of an American tradition.” We can all feel good about making planned giving a jewel of a Canadian tradition too.  

Thanks for reading, and have a great day!  

Ian Hull