Many people continue to make charitable giving a priority after they retire. To meet your giving goals, it’s helpful to plan your cash flow for both the present and the future. Consider your income and investments before and during retirement. When you contribute to a donor-advised fund, you receive a tax deduction in the year you make the contribution. You can decide to give to charities immediately or wait until later, even after you retire. Any assets left in the fund can keep growing tax-free in investments such as mutual funds, ETFs, and stocks. 

When you are still working, you may be in a higher tax bracket and more likely to itemize deductions on your tax return than after you retire. Giving more to charity now can provide greater tax benefits than waiting until retirement, when your tax rate might be lower. 

One main benefit of a donor-advised fund is that any money left in the fund can grow tax-free. These accounts are invested much like other investment accounts, using assets such as mutual funds, stocks, ETFs, and cash. You can also contribute other assets, such as artwork, restricted stock, or even business interests. 

Setting up a donor-advised fund is more than just making a contribution. These funds offer several benefits beyond tax deductions and tax-free growth. You can make grants to different charities over time, contribute many types of assets like cash, securities, or even more complex assets, and involve your family in your giving. You can also invest the fund's assets for potential growth before making donations, which can help increase your charitable impact. 

Because there are many benefits and some complexities, it’s a good idea to talk to a financial advisor or tax professional. They can help you decide if a donor-advised fund fits your financial and charitable goals, and make sure you get the most out of the available benefits while following the rules.  Please reach out to our office to schedule a time to discuss whether a donor-advised fund makes sense for you and your family.  Click Here to schedule a time to speak.