Family Giving: Tips for Making Charity A Family Tradition

Generosity is a value that can bring families closer together and create lasting memories. By starting a tradition of charitable giving, you can instill the importance of philanthropy in your family. Here’s how to get started donating to charity.

Choose a Cause

Selecting a cause that resonates with your family is the first step in making charitable giving a meaningful tradition. Here are some tips to help parents and grandparents get the family involved with their philanthropic goals:

• Personal Connection: Choose charitable organizations that have a personal connection to your family. Whether it's a health issue that has affected a loved one or a local community project, a personal connection can make the act of giving more impactful.
• Give Kids a Voice: Involve children in the decision-making process. Ask them what causes they care about and why. This not only empowers them but also helps them understand the importance of philanthropy.
• Understand Interests and Values: Take the time to understand the interests and core values of each family member. Aligning philanthropic goals with these values ensures that everyone feels invested in the cause.

Create an Annual Family Giving Budget

Establishing an annual budget for charitable giving helps maintain consistency and allows for thoughtful planning. Here are some guidelines to consider:

• Set a Total Budget: Establish a family giving plan that determines the total amount your family is willing to donate each year. This can be a fixed percentage of your income or a specific dollar amount.
• Divide the Budget: Allocate portions of the annual family giving budget to different causes or organizations. For example, you might divide the budget into categories such as local community support, health-related charities, and educational initiatives.
• Review and Adjust: Regularly review your budget and adjust it as needed. This ensures that your giving remains aligned with your family's financial situation and philanthropic goals.

Choose a Charitable Giving Vehicle

There are various vehicles families can use for charitable gift giving. Each avenue has its own advantages and the potential of tax deductions for charitable gifts. Here are some options to consider:

Donor Advised Funds

Donor Advised Funds (DAFs) allow families to make a charitable contribution, receive a tax deduction and then recommend grants from the fund over time. DAFs offer flexibility and can be a great way to involve family members in ongoing philanthropic decisions.

Life Insurance

Gifting life insurance is another option for charitable giving. By naming a charity as the beneficiary of a life insurance policy, families can make a significant impact. This method also offers potential tax benefits.

Private Foundations

Creating a private foundation provides families with control over their charitable giving. Foundations can support a wide range of causes and offer tax benefits. However, they require more administrative work and compliance with regulations.

Keep Family Members Engaged

Maintaining engagement in philanthropy as family members age and build their own wealth is crucial for sustaining a tradition of giving. Here are some tips:

• Regular Conversations: Have regular discussions about charitable giving and the impact it has. Share stories of how donations have made a difference and encourage family members to share their thoughts and experiences.
• Establish a Giving Cadence: Set a regular schedule for family giving activities, such as annual meetings to review and plan donations, volunteer days or fundraising events.
• Encourage Personal Philanthropy: As young family members grow older, encourage them to develop their own philanthropic interests and goals. Support them in their efforts and celebrate their contributions.

By making charitable giving a family affair, you can create a legacy of generosity that spans generations. Start today and watch how philanthropy can bring your family closer together while making a positive impact on the world.

Talk with a Professional

When you’ve reached a decision about how you want to give back, don’t feel like you have to go at it alone. Farm Bureau Financial Services agents can help provide resources that achieve your philanthropic goals.