There are specific times and events in your life when planning your gifts can result in great benefits for both you and your favorite charities. Important events include the sale of appreciated assets, sale of a business, farmland, or retirement.
Planned Gifts may be made either during your lifetime or at death. Estate Planning is not only for the wealthy; it is for EVERYONE. The plan is implemented through a Will or Revocable Living Trust. This usually involve the assistance of professionals such as your accountant, attorney or financial planner.
How does your checklist look? Do you have. . .
A Will is a legal document that describes your plans for your property upon your death. It is the foundational document required for all Estate Plans.
If you don’t have a Will, the state has one for you. Laws are enacted in each state to determine what will be done with the assets of an individual who dies without a Will. Unfortunately, the state’s “Will” does not take into account your personal values, Christian commitment, goals, family situation or needs. A Will enables you to decide who will become the next “steward” of the resources that God has entrusted to you.
In your Will, you can name the person you would like to be the Guardian of your children. The Guardian has responsibility for the physical care of your children. Your children’s financial needs can be met by creating a Children’s Trust in your Will. In creating a Trust, you must appoint a person to be in charge of the Trust, called a Trustee. Your Trustee will invest the assets in the Trust and make decisions about their distribution to your children.
For many people a Revocable Living Trust is an excellent way to implement their Estate Plan. Like a Will, a Trust makes provision for the transfer of your assets at death. Unlike a Will, assets in the Trust are not subject to the costs and delays of probate. During your lifetime, it remains completely under your control.
Trusts are not for everyone. Due to the the added initial cost, funding requirements and other issues, some people prefer a Will for their primary Estate Planning document. Even with the Trust, it is recommended that you have a Will, often called a “pour-over” Will to cover any assets not included in the Trust at your death.
When planning for the future allocation of your estate, you can use the occasion to reinforce the importance of the biblical concept of a tithe to your family. For example, if a couple with four children had an estate of $600,000, a tithe of the estate would provide $60,000 for charity and $540,000 to their children, or approximately $135,000 for each child.
The concept of a “Child Named Charity” actually was presented to the Barnabas Foundation by a couple who had lost a child and wanted that child’s share to go to their favorite Christian charities. It has become a popular way for many people to distribute gifts from their estate.
For example, if a couple has four children and wants to include a “Child Named Charity” in their plans, they would divide their estate five ways: one-fifth to each child and one-fifth to their favorite Christian organizations. A “Child Named Charity” makes a strong statement to family members about your commitment to your Christian cause. At the same time, it still provides a substantial portion of your estate for your childrenT
Debt Reduction or Debt Retirement
Here is an example, Freeman Academy has a balance left to pay on the construction of Sterling Hall and the Link. Our loan, from Merchants State Bank of Freeman and the US Dept. of Agriculture, will mature in 2023, we could save thousands of dollars in interest if we can pay it off early.
A generous gift to this cause would benefit the school by saving money that could be used for other needed improvements on campus, student tuition assistance and general operating cash flow.
Each year, twenty or more students receive some percentage toward tuition assistance to attend Freeman Academy. That assistance is funded through cash gifts, estate gifts, and interest on invested endowment money already gifted to the school by individuals and alumni classes.
So many young parents have come to the school interested in the Christian-focused classroom setting and the noticeably, positive changes in students. We do everything in our power to keep costs down. South Dakota does not give state funding to independent schools. We rely on our volunteers, tuition costs, alumni and donors to help continue our mission.