When we define our philanthropic legacy through our wills or perhaps through an endowment fund which is perpetual, it is best to ensure that our charitable intentions are able to stand the test of time. We are all safeguarded by American laws which protect donor intent. Additionally, it is good to know that industry standards guide professionals and charities with ensuring donor intent is followed. The Association of Fundraising Professionals provide guidance with their Donor Bill of Rights and our Church also provides guidance through Canon 1262.

As a donor we can contribute to these laws and best practices by taking steps to ensure our intentions are honored in the present and future. The first step is being clear and transparent about our wishes and intentions for how the gifts can be used. Defining them clearly in writing is most effective. When establishing an endowment it is important to remember that the fund will continue into perpetuity – beyond our own lives and the lives of those we are entrusting our gifts to.

Following are some of the details to consider and define clearly when establishing your legacy gifts and/or endowment funds:

Name – If you are establishing a fund, what do you wish the name of the fund to be? The organization managing the fund over time will share this name in a variety of ways. Make sure they are clear on the name you want. If you are offering a one-time charitable gift how do you wish for the gift to be recognized? Fund names or recognition names can be our own, might be our Family name, might be in memory of someone we love or you may wish to remain anonymous.

Beneficiary – Who will benefit from your gift or fund? Name the organization(s) you wish to support through your gift or fund. Be sure to name them correctly so that they cannot be confused with another organization. Certain organizations have regional and national chapters or organizations such as Catholic Charities. Is your intention to support Catholic Charities USA or to support Catholic Charities of Central Florida?

Purpose – What are your intentions for the use of the fund? Endowment funds, while lasting into perpetuity, provide annual revenue streams for the beneficiary. How do you envision the annual grants of an endowment fund being used each year? Is your intention for them to be used for one purpose or are there several uses which would satisfy your desire to support this organization?  An example might be a fund you want established to support a school – how do you wish to support the school? Do you want to support students in need and if so, how do you define students in need? Do you wish to support the teachers or perhaps you want to support the maintenance and capital structure of the school? You might simply wish for the school to use the funds based on their highest operational need? You can consider offering multiple uses but whatever you decide, you should state your intentions clearly and in writing. With a charitable gift that is not being left through an endowment fund, define if this gift is unrestricted or if you have a restricted, specific use for the gift.

Alternate purpose – Particularly for endowment funds it is good to consider if you will allow an alternate purpose should your primary purpose be frustrated at some point in the future. As an example, if leaving a gift to support a school in purchasing new technology – there might be a year when they do not have a need for new equipment. Is there another purpose you would allow the school to use the funds to support should the primary purpose not be needed in any given year? Even with a one-time legacy gift, should the gift mature during the year there is no need for your primary purpose – do you wish to provide an alternate purpose for the school to use the funds in the same year or do you wish for the school to wait to use the funds until they have a need that matches your intentions?

Authority – Many times gifts are made without the consideration of who in the future will be in authority to receive your gift and use it for the beneficiary organization. We often think about the president, principal or pastor we know today, with an understanding of how they would use the gifts but don’t always consider the time it will take for the gift to mature or with endowments, the timeframe of perpetuity, and who will be in the position at that time. Safeguards can be put into place recognizing that we won’t know who will be in authority in the years to come. Defining the principal and the school board, president and board of directors, pastor and parish council as the authority to make decisions on how the funds will be used each year (if you have options in your intentions or if there is some frustration of purpose in the future) ensures that the decision will be discussed and reviewed by multiple individuals rather than just one.

When establishing an endowment fund or considering a legacy gift to a particular organization you may wish to inquire about their processes for ensuring donor intent. For endowment funds and donor advised funds you may also wish to consider naming advisors for the beneficiary to engage with after your death.

If you are considering a legacy gift or an endowment fund as part of your charitable giving and would like to speak with someone please contact our office at 407-246-4888. Several of our team members are Chartered Advisors in Philanthropy and we have a Planned Giving Advisory Council made up of legal and financial advisors. We would be honored to walk with you on your philanthropic journey.



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