Issue 40.11
Doing certain things in life makes you feel good. Giving to a charity or worthy cause is one of the things in life that “fills one’s soul”.
As an estate planning attorney, I have enjoyed helping clients create charitable bequests and even legacies. Although there are more complex ways to leverage your charitable bequests, you may be surprised how simply you can create a charitable legacy.
With permission from the client and Dixie State College, I would like to share a specific example. This particular client loves music. At age 80, she continues to take personal piano lessons and enjoys attending symphony productions. She talked to me about doing something special for the Dixie State Orchestra.
Please know the client’s estate is very “normal” in size. It consists of a comfortable home, a bank account and a modest retirement account. This wonderful individual is not in the “rich and famous” club. She is a normal person doing something extraordinary.
As part of her estate plan, she established a “legacy bequest” to the Dixie State Orchestra. To create the “legacy bequest” we simply established that upon her death a trust would be created benefiting the Orchestra.
It is a “legacy bequest” because it will go on forever. Each year, 90% of the net income generated from the trust will be distributed to the Orchestra. The other 10% of net income will be retained in the trust to help it grow.
In a 100 years from now, the Dixie State Orchestra will still be benefiting from this client’s charitable bequest.
In fact, with the 10% added to principal each year, in 100 years from now the annual bequests of 90% of net income will be significantly greater. As the years turn to decades, this client’s simple act of charity will be benefiting the lives of more and more Orchestra members through partial scholarships, as well as the Dixie State Orchestra in general.
“Legacy bequests” benefit charities for generations to come. With a simple amendment to an existing estate plan or a small addition to a plan being created, you can leave a charitable bequest that will benefit the lives of musicians, students, athletes, single mothers, animal sanctuaries, religious affiliations or any other charitable organization for generations to come.
Jeffery J. McKenna is a local attorney serving clients in Utah, Arizona and Nevada. He is a shareholder at the law firm of Barney, McKenna, and Olmstead with offices in St. George and Mesquite. If you have questions you would like addressed in these articles, you can contact him at 435 628-1711 or jmckenna@barney-mckenna.com.