The most important aspect of philanthropy is having not only the desire to be a blessing in others’ lives but also ensuring that your way of giving makes sense for your personal situation. A will and trust are both great avenues to donate one’s money to an organization or foundation, yet there are differences between the two that are important to consider when making the decision to give.

“Which option can allow me to provide the most amount of help? What is the difference between the two? I want to help in a way that works for me.”

Will

A Will is a legal document that details instructions to the court on what should happen to your possessions following your death. A bequest can be included in your will, which designates a specific amount of money or a percentage of your estate or assets to your selected foundation. One foundation can be selected to receive money, or multiple foundations can be listed to split the gift among. It’s important to note that it only goes into effect after you pass, and since there is a probate process it may take time before the foundation(s) can receive the funds.

Example: Maria, a retired teacher, added a clause to her will leaving 5% of her estate to support scholarships. This addition ensured that her gift would be distributed after her passing, without affecting her financial security during retirement.

Trust

A trust is a legal arrangement that places your possessions and assets with a separate entity that is managed according to your own instructions. In a trust, you can name a foundation as a beneficiary, receiving the gift automatically once you pass with no delay. Multiple foundations can be made beneficiaries, being able to customize how you want to personally give to each. It is also possible to give support to a foundation over time, instead of one lump sum, with ongoing payments.

Example: John and Ellen wanted to see their giving in action. They created a charitable trust that sent annual payments to their favorite foundation while they were alive and will continue doing so automatically after their passing.

Tips

  • Understand the timing of a will and the probate process
  • Depending on your trust you can make donations while still alive
  • You can choose to have both a will and a trust
  • In a will you can give a foundation a percentage of your estate
  • A trust can allow for a lump sum or ongoing annual payments
  • Information in wills become public record after the probate process, while trusts remain private

Do not allow for confusion regarding a will or trust to halt your philanthropic spirit from the gift that is giving to those in need.

To learn more, visit our Changing Lives with Legacy website at MyImpact.CatholicEducationArizona.org or contact legacy@ceaz.org or call us at (602) 218-6542.