CFoPC can help you secure your charitable legacy!
A big part of our work at the Community Foundation of Pulaski County (CFoPC) is to help local individual residents, families, and businesses with fund management.
Your gifts of charity to CFoPC are so very important to us because they make it possible for us to do our work of building a brighter future for all those in Pulaski County. We also understand the crucial importance of keeping you informed of developments and trends with which we can help you achieve the most out of your charitable giving goals.
If you’ve not yet established a CFoPC fund but are interested in doing so, now is a great time. We can help you explore the many, various options to support our mission, and we prioritize connecting you with funds representing the community causes most important to you. If you’d like to learn more about establishing a fund, contact us or visit our online donation portal.
Life Insurance as a form of charitable giving
Life insurance is a popular and important financial planning tool, and—in some cases— life insurance can even be an excellent tool to support your charitable giving. The Community Foundation of Pulaski County is happy to work with you and your advisors to explore how you might use your life insurance policies to further your philanthropic goals.
You’re likely aware of the important role life insurance can play in your estate and financial plans. Indeed, more than half of GenX and Baby Boomers hold life insurance policies, and annual payouts from these policies total nearly $800 billion! What you might not know, though, is that life insurance can be a very effective charitable giving tool under certain circumstances, offering a unique opportunity to support causes you care about as you carry out your charitable objectives.
The following are some of the basic strategies for Life Insurance as a viable philanthropic tool:
Beneficiary Designation:
It’s simple and easy to name your CFoPC fund as a beneficiary of your life insurance policy. Although IRAs and other qualified retirement plans are frequently more tax-effective for charitable giving, life insurance is sometimes a viable and flexible option for a charitably-minded individual who wants to leave an estate gift that can fund favorite causes for many years into the future.
Estate Tax Planning:
“Second-to-die” life insurance policies, which may become more popular if the estate tax exemption decreases after 2025, can be used to hedge against anticipated estate taxes, thereby allowing you to provide well for family members and still have plenty in your estate to satisfy a bequest to a charity, such as your CFoPC fund.
Boosting Charitable Capacity:
Increasing coverage on an existing policy can be a cost-efficient way to include charitable giving in your estate plan. For example, if you have a million-dollar policy intended for four family members, adding $250,000 in coverage typically won’t increase premiums by 25%. This allows you to include a CFoPC fund as a fifth beneficiary, each receiving an equal share.
Repurposing Term Insurance:
The U.S. life insurance market is growing rapidly, expected to reach more than $4 trillion by 2033—and a lot of it is term insurance. If you’ve outlived the initial need for your term policy (such as covering college expenses or a mortgage), consider continuing the policy for charitable purposes. Past premiums can be viewed as sunk costs, while future premiums become a moderate “investment” relative to the potential charitable impact.
Please reach out to us at the Community Foundation of Pulaski County to discuss how you can use your life insurance as a way to cement your charitable legacy! Whether through a beneficiary designation, together with perhaps even a potentially tax-deductible transfer of the policy itself or ongoing dollars to pay the annual premium, we can work with you to navigate the options. The CFoPC team is here to help you create a lasting legacy that supports the causes you care about most, especially while optimizing your estate planning at the same time.