U.S. Trends in Charitable Giving

Written by Jeff Helms

The financial world is complex and constantly changing. Those changes can impact our clients and their plans for the future. As the firms founder and Managing Partner, making sense of these changes is my job. We try to simplify communication on market dynamics to make it meaningful and useful for our clients.

April 8, 2015


U.S. Trends in Charitable Giving-media-1

As the U.S. economy has continued to stabilize, Americans have begun to increase their contributions to charitable organizations. In 2013, Americans gave an estimated $335.17 billion to charities. When giving to charities, there are a few viable options, including:

  • Direct Gifts – These are direct contributions to charitable organizations. Direct gifts can usually be deducted from income taxes.

  • Charitable Gift Annuities – In these situations, a donor will give money, securities, or Real Estate to a charity. In return, the organization agrees to pay the donor a fixed income. Upon the death of the donor, the assets will pass on to the charitable organization.

  • Gifts in Trust – This type of charitable donation enables donors to contribute to a charity and leave assets to certain beneficiaries.

Important Strategies for Charitable Planning

No matter how you choose to donate to charities, you should consider implementing a strategy for charitable planning. There are several charitable planning strategies that can be implemented. Below are a few of the popular planning mechanisms.

  1. Where charitable contributions are concerned, think of yourself as a donor, but also an “investor.” Are the returns on your investment to a charity clear to you?

  2. Create a comprehensive “To Do” list to ensure that advisors cover all of the most important aspects of the charitable planning process. This list might include the following items:

  3. Plan ahead for financial, estate, and tax considerations for non-cash asset contributions. By donating non-cash assets such as appreciated stock, real estate, or life insurance policies, a donor can support the charities that they care about, while still preserving cash and generating income tax benefits. Donating illiquid assets takes a bit of extra planning. By working with advisors and planning ahead, donors will be better prepared to give these types of assets.

  4. Educate yourself on the legal fundamentals of international giving. From 2000 to 2009 international giving by U.S. foundations rose from $2 billion to $6.7 billion. Working with a trusted advisor will help you to understand where, how, and what type of assets you can give to an international charitable organization.

  5. Conduct due diligence. Due diligence should be a part of any charitable planning strategy. Check for tax-exempt status, review budgets, analyze audits, and ask about any conflicts of interest. Conducting due diligence is necessary to protect both the donor and the charitable organization.

In conclusion, charitable donations are on the rise within the United States. Successfully implementing comprehensive strategies for charitable planning will help donors continue to successfully contribute to their chosen charities. Contact your trusted team of asset managers and advisors at First Coast Wealth Advisors to learn how you can invest in charitable donations.