Most people searching for meaning in their lives will seek answers to the big questions at some point. A question like, “Did I leave the world better than I entered it?” is one we will all eventually ask ourselves.
For those with financial means, establishing a family foundation will help answer the tough questions in a way that adds meaning to your life and benefits you, your family and your community.
How to Establish a Family Foundation
A family foundation can be created during your lifetime, or on your behalf using funds from your estate as directed in your last will and testament. Establishing a family foundation can be accomplished by creating either a charitable trust, or a charitable corporation. Though both types of organizations allow for charitable giving, the governing laws are different for each organization.
Generally speaking, a charitable trust is difficult to change once it has been established. When you choose to establish a charitable trust you can be assured that your goals will continue to be honored by others who manage the trust after you’re gone.
On the other hand, a charitable corporation provides greater flexibility regarding corporate documents, and makes it easier for future generations to alter the original intent if the needs of the community change over time.
Determining the right type of foundation for you requires a discovery process that uncovers your current needs and future desires.
Why Establish a Family Foundation
There are many benefits to establishing a family foundation. Establishing a family foundation will help you to avoid considerable estate and income taxes. This will ensure that more of your money goes to a charitable cause that you find meaningful, rather than being collected by the government. The family foundation gives you more control over what is done with your money.
What about the “family” part of a family foundation?
Establishing a family foundation will also benefit family members who are involved in the day-to-day operations of the foundation. You can set up the foundation to provide salaries to family who work for the foundation, helping them to achieve financial security. In addition to helping your family members financially, the foundation gives your family members a vehicle for their own charitable giving, adding meaning to their lives. The foundation provides a connection between you and your family members that will outlast your lifetime.
Of course, most family foundations are established to meet a need in the community. Whatever the particular cause of your foundation, you can be assured that you will be making a difference in the lives of others.
Once established, a family foundation is perpetual, and the charitable giving that you start will continue for years after you are gone. With a family foundation your positive impact will be your legacy for future generations.
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