How can you maximize your giving? What philanthropies are in need? How can we come together to support those less fortunate in the season?
2020 has flown by. We’ve now gone through nearly all of the major holidays with a looming risk to healthy gatherings. Valentine’s day, Easter, Independence Day, Memorial Day, Labor Day, Halloween, Thanksgiving, and soon to come Christmas.
This past month was certainly strange. Stock markets making record gains, possible vaccines, quarantining on Thanksgiving, and enough headlines to make you want to quarantine from the news. But in light of all these missed holidays with friends and family, there is one that can be celebrated just as easily together as apart. Giving Tuesday!
If you’re like me, you’ve never even heard of this holiday until today. I actually didn’t know it was a day, and I’m not convinced that it is a national holiday yet, but it definitely should be. It started in 2012, is always on December 1 and according FAQ - GivingTuesday countries all over the world participate.
Now, if you are someone who has withstood the market this year, held on to good investment principles, and stayed the course; April, July, August and especially November may have generated some significant gains in your portfolio. November being special because all three major indexes (S&P 500, Nasdaq composite, and Dow Jones Industrial Average) closing with more than 11% gains for the month. If you are a generous investor, you might be thinking, “What can I do with all these gains I just received?”
Well lucky for you it’s Giving Tuesday and there are thousands of ways to help those less fortunate. When it comes to supporting your community, values, charities, church, or local zoo, be sure to contact a financial advisor to ask about ways to maximize your giving, because every situation is different and a trained professional should be able to help find the best strategy for your values.
Depending on the organization, you may be able to send stock directly to the charity and take a deduction based on the cost basis of the stock (be sure to consult with your tax advisor first though.) Or perhaps you are still needing the income to support your lifestyle, but you’d still like to setup a way to donate funds to a charity of your choice. With a charitable trust you are able to donate the investments to the charity and remain in control of how the funds are invested. You are also able to take the income or dividends from the portfolio as they are paid. Another option may be a donor advisor fund (DFA). Depending on what’s available to your investment bank, you may want to ask about donating to a DFA. which pools investments together to maximize the charitable gift to specific organizations. Or perhaps you’d like a more conservative option to pass on to your philanthropy. You can designate an endowment as the beneficiary for an insurance policy. Upon your passing, the endowment would receive your gift to help support the organization long after. Or perhaps you’re able to serve as a board member and personally bear the financial deficiencies of a charity with the other members. Or even more, start your own charitable foundation...
With all the different ways to maximize your giving, be sure to contact a financial advisor. There are thousands of good causes to support and even more charities to give to that help serve those in need this season. While this pandemic may have taken away time with friends and family, we can still send our support for those who need it the most.