There are many reasons to write a Will, and we talk about them in most of our posts on this blog, but one area that we’ve not really touched on is the power of your Last Will and Testament to make a difference to the World. Most of us feel that on a day-by-day basis we could probably do a little more by way of charitable contributions. But it turns out that your Will is one of the most powerful tools for helping people and organizations in need. The common term for this is “planned giving”.
We’ve all heard the story of the elderly widow, with no family, who left their wealth to a local cats’ home, but charitable giving need not always be so newsworthy. Most Wills have sections for specific gifts which allows you to name a sum of money (a “pecuniary legacy” as it is known in the UK) for a specific beneficiary. This really gives you an opportunity to be a little more generous that you may have been during your lifetime and for many modest estates, a $10,000 or £5,000 legacy can be comfortably absorbed.
The next step is to choose the appropriate charity. For some people there may be a particular cause that touched their lives, but it is always worthwhile to conduct a little research into the effectiveness of charities and how much of your donation ends up making a difference. The CBC in Canada this morning exposed the finances of the Canadian Cancer Society which showed how currently 22% of donations end up going to research, down from 40% ten years ago.
Fortunately, there are plenty of resources available to help with your research. In the US, Charity Navigator provides detailed financial breakdowns and rankings of thousands of charities. The UK equivalent is the government-run Charity Commission. In Canada, Charity Intelligence provide a number of reports and last year Moneysense magazine ranked the top 100 charities by things like Efficiency, Governance and Transparency. It would be terrible to think that your legacy was doing little beyond paying salaries to a Board of Directors rather than going to the cause itself.
Once you have decided on the charity, you have to make sure that you name it in an unambiguous way in your Will. Leaving a bequest to “cancer” does not give your Executor enough information to distribute the legacy (although the terms in the Will usually allow them to make their best effort in this case). You should include the registered number of the charity which could either be found on the website or with a government agency.
So if you really couldn’t think of a reason why you would need a Will (and I would love to hear any of these in the comments!), maybe the opportunity to make a difference to the World is just the spur that you need.