What is a legacy gift?
Legacy gifts refer to a gift left in your Will in the form of property, cash, or as a portion of estate (called a residual gift). While charities have several ways that people can donate and make an impact, legacy gifts play a crucial role in the future of these organizations due to their size and significance. Due to the recent COVID-19 pandemic, many charities have cited the importance of legacy gifts in challenging times.
For many people, the best opportunity to make the biggest gift and impact of their lifetime is to leave a gift in their Will. Only about 5% of Canadians currently leave a gift to charity in their Will, while over 10% of people in similar countries like the United Kingdom and Australia do so, which represents a huge opportunity for more, which represents a huge opportunity for Canadians to have an impact on the charities they support. Although these numbers may appear small, according to the Canadian Association of Gift Planners (CAGP), moving from 5% to 8% represents a $40 billion opportunity to better support the sustainability and future of Canadian charities.
Why should I leave a legacy gift?
While people often tend to give to charities only when asked, creating a legacy requires a lot more thought and careful consideration. After all, this is a completely unique process that should be representative of the individual. There are many things to consider when leaving a legacy gift, but the process of leaving a legacy gift should always start with one question: “How do I want to be remembered?” For further understanding, check out this additional post on how to approach picking the right charity.
One of the biggest misconceptions about legacy giving is that it’s only for philanthropists and high net-worth individuals, which couldn’t be farther from the truth. Rather, a legacy gift is a powerful tool that everyday people can use to make an impact on charities as well as their own estates.
While another common misconception of legacy giving is that it will take away from a loved one’s inheritance, a legacy gift can actually offset some of the taxes on an estate to ensure that a greater portion of the estate is inherited by the family rather than the government.
How do I leave a legacy gift?
A charitable bequest - also known as a legacy gift - can be donated in two common ways. The first is as a lump sum of cash called a cash gift, and the second is called a residual gift, which leaves a percentage of the estate to the charity of choice. The main difference between the two is that a cash gift will stay the same over time, while a residual gift can grow in value as the estate grows.
When creating a will through Willfora, leaving a legacy is both easy and encouraged. In the flow of creating your Will, you will come to a section titled “Leave a Legacy”, which is dedicated entirely to legacy giving. Once you reach the page, you can use the search box to find your charity or charities of choice. If the desired charity is not listed in our dropdown list, please email hello@willfora.com to have it added.
There will also be a section at the bottom of the page that gives you the option to share your gift with the chosen charity. Sharing gift intentions is always encouraged, as it helps charities plan for the future, and they will definitely want to thank you for your generosity.
Once the legacy gift has been made and the rest of the Will requirements are completed, it’s also a good idea to double check that you have the right charity selected when reviewing the document. Just simply check that the registration number on the Will document matches up with the number on the charity website or Canada Helps reference list.
Willfora allows unlimited updates, so you can come back anytime to make changes to update your gift or add new charities. Just log back into your account, make the necessary changes, and sign and store the new document, since the new Will will revoke all previous versions.
While it’s our goal to provide Canadians with helpful information on legacy giving, making the process as simple as possible is equally important!