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How Will Power (willpower.ca) Helps Canadians Leave A Gift To Charity In Their Wills

Category 3: Donate gifts

Maybe you’ve seen the posts, billboards or videos. The Will Power campaign (willpower.ca) says you can support both your favourite charities and your family through your Will. That’s true.

Once you know that you can leave a charitable gift at death — a legacy gift — other questions arise. Will Power increases awareness and provides resources to answer your questions. This comprehensive multi-year initiative from the Canadian Association of Gift Planners (CAGP) was launched in September 2021.

Small changes can have significant impacts. If the percentage of Canadians who leave a charitable gift in their Will increases from 5% to 8.5% by 2030, charities will raise an additional $40 billion. Imagine the impact!

At Taxevity Insurance, we’re founding members of Will Power. We’ve already posted dozens of weekly videos with thoughtful quotes related to philanthropy on YouTube and social networks. We also provide direct assistance.

What is a planned gift?

A planned gift is a charitable donation you make with careful thought. These gifts are usually from your assets and larger than gifts from your income. You do the planning now and make your actual gift in the future — often through your Will.

What are gifts through a Will called?

A charitable gift in a Will is called a bequest.

Bequests can be made to individuals, charities, or organizations. In some cases, a person’s entire estate can be gifted under a Will, while in other cases, specific items or monetary amounts are designated. Bequests may take the form of tangible property, such as stocks and bonds, or intangible property, such as intellectual property or copyrights.

A residuary bequest is one that is made after all other debts and expenses have been paid out of the estate. General bequests are typically monetary gifts that are distributed equally among multiple beneficiaries stated in the Will.

It is important to have a valid Will in place to ensure that your wishes are honoured in the distribution of your estate.

What is the purpose of your Will?

Your Will makes your intentions known.

You can do this by including specific bequests for the people or organizations you want to support, such as setting up a trust fund for your children, donating money or property to charity, or gifting stocks and securities.

You can also designate guardians for minor children or provide for their university education in your Will. Additionally, you can use life insurance policies to provide long-term financial security for those who depend on you.

No matter how you decide to distribute your assets, there’s value in having an experienced lawyer review and draft your Will to ensure it is legally sound, and all of your wishes are carried out.

How can you support both your family and your favourite causes in your Will?

No one wants to run out of money. This can lead to hoarding because you don’t know how much you need for the rest of your lives. Financial planning helps you understand what might happen under scenarios that are favourable and unfavourable. What happens to the assets that you and your partner leave behind? Most Canadians use a Will to clarify their intentions. Your Will can also include a charity or charities as your beneficiaries.

Your donations can be made via a bequest, which is the legal term for a donation made through your Will. You can make charitable bequests to any registered charity or non-profit. You can specify the exact gift amount or percentage of your estate that you would like to donate.

How do you find and select charities to support?

Canada has over 85,000 charities. Imagine the number in other countries. The Will Power website helps you find charities in Canada. At willpower.ca/charities, you can:

  • Search by cause
  • Search by location
  • Search by keyword

You get results in a consistent format, which makes comparing easier. You aren’t shown all the charities in Canada, only the smaller number of charities that cared enough to participate in the nonprofit initiative. You are free to give to other charities inside and outside Canada.

How do Canadians include gifts in wills?

You can create and update your Will in two ways, each with pros and cons:

  1. Use an online service: faster, cheaper and easier to update
  2. Use an estate lawyer: more comprehensive, more expensive and more time-consuming to update

Your Will requires updates as your life and intentions change. You can change the charities you select. You have flexibility. You could donate a specific dollar amount or a percentage of your estate. Figuring out what is right for you is often easier if you get help, starting with the Will Power website or your advisor (if your advisor knows about philanthropic planning).

What is the right portion of your estate for your philanthropy?

Will Power has a simple calculator to estimate the impact of your donations at willpower.ca/legacy-calculator. Suppose your estate is worth $1,000,000. You could select:

  • 1% for charities is $10,000, leaving $990,000 for your heirs
  • 5% for charities is $50,000, leaving $950,000 for your heirs
  • 10% for charities is $100,000, leaving $900,000 for your heirs

The tax savings from making donations reduce the cost of doing good, which leaves more for your family,

Why not make a gift to a charity directly?

While you can make your gifts through your Will, you can also make them directly. The Will Power campaign is more about making gifts at death — legacy gifts — than making gifts in a specific way.

Assets like your RRSPs, RRIFs and life insurance can have a charity as the sole beneficiary or one of a number of beneficiaries. The charity could also be a contingent beneficiary, meaning that your living beneficiaries have top priority.

Here are other reasons to consider donating directly:

  • Changing a beneficiary designation may be easier than changing your Will
  • The process of probating your Will causes delays
  • You lose privacy when you donate through your Will

How do you leave a gift in your Will?

Leaving a gift in your Will is like leaving a gift to a beneficiary. You decide where the money goes and the amount. The paperwork needs to be done correctly, though.

Reminder: Make sure to sign and date your Will so that it’s legally binding when it’s time for it to take effect.

What is the best way to give to your favourite charities?

The best way to make a gift to charity is with planning. You have much to consider:

  1. When do you give?
  2. How much do you give?
  3. Where do you give?
  4. What do you give?
  5. How do you make your donations go further?

Learning takes time. Will Power (willpower.ca) provides resources. In addition, you may want to join a group of other philanthropists. Your local community foundation (find one near you) may be a great place to start because they often provide education and are aware of local needs.

We are also happy to help.

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