“Generosity is the flower of justice.”Nathaniel Hawthorne
Nathaniel Hawthorne, the renowned American author who lived from 1804 to 1864, captures the spirit of legacy giving in this insightful quote. His words inspire us to look beyond bare minimum obligations and instead seek opportunities to create a lasting charitable impact.
About the Author – Nathaniel Hawthorne’s Life and Death
To better understand the context behind the quote, let’s explore Hawthorne’s own life story. Nathaniel Hawthorne was born in Salem, Massachusetts on July 4, 1804. After graduating from Bowdoin College, he held various governmental positions, including at the Salem Custom House. He became a renowned author, writing novels and short stories that explored moral issues and human nature through the lens of New England Puritan culture. His most famous works include The Scarlet Letter, The House of the Seven Gables, and The Blithedale Romance.
Hawthorne died in Plymouth, New Hampshire, at age 59 on May 19, 1864. Hawthorne lived a productive life as a public servant and impactful author, leaving behind a legacy of insightful literary works that are still appreciated today.
Connecting the Quote to Philanthropy
Hawthorne’s quote elegantly captures how going beyond basic obligations through generosity is an act of moral justice. Charitable estate planning allows everyday Canadians to embrace this ideal.
While we must first provide for our loved ones, Hawthorne notes we can also look to higher ideals of justice through charitable giving. Estate planning tools like Wills, life insurance, and registered accounts present opportunities to donate to causes we care about. Through generosity, we create a flowering legacy that uplifts others.
Many Canadians are fortunate to have sufficient wealth to care for family and support charitable causes. According to Statistics Canada, the average family has a net worth of about $1 million ($967,202 in 2023 Q2, according to Statistics Canada), with the biggest components being real estate equity and registered savings like RRSPs.
Acts of generosity add up. A $50,000 life insurance policy or RRSP/RRIF donation may seem small. Still, each gift combines with philanthropy from others to drive real community impact. Imagine the justice that could flower if more Canadians included donations in their estate plans.
Life Insurance Can Fund Charitable Giving
Permanent life insurance is a flexible way to create a charitable legacy or replace assets going to charity.
Donald, a 75-year-old retired teacher with an estate valued at $750,000, wants to provide for his two adult children. Additionally, he desires to leave a $250,000 gift to establish an education scholarship fund.
Donald takes out a $250,000 permanent life insurance policy with the education charity as the beneficiary. The coverage replaces the assets he would have donated directly through his estate, allowing him to maintain his children’s inheritance.
Life insurance enabled Donald to fulfill his family obligations and pursue justice through a generous charitable gift.
Significant Tax Benefits Apply
Government tax incentives further motivate Canadians to give generously.
Let’s revisit Donald’s example. His $250,000 charitable gift comes from a life insurance death benefit rather than his estate. This structure meets the criteria for a donation tax credit.
Assuming Donald is in a 40% tax bracket, the donation credit saves his estate $100,000 in taxes owed (40% of $250,000). This means that, in a sense, the government paid for $100,000 of his gift.
Between the tax credit and the use of life insurance, Donald created a substantial $250,000 legacy gift at a minimal cost to his estate.
Take Inspiration from Nathaniel Hawthorne
As Nathaniel Hawthorne wisely observed, embracing generosity allows us to move beyond minimum obligations and act for the greater good. By including charitable estate gifts, everyday Canadians can foster justice, uplift communities, and leave their own flowering legacies.
Start Your Charitable Planning
Do Hawthorne’s words inspire you to consider charitable planning in your estate? We’re happy to have a no-obligation discussion about tools like life insurance and guide you through the giving process.
By acting generously, your legacy can plant seeds of justice that continue doing good long after you’re gone. Please reach out today to start planning the charitable difference you want to make.