By Christine Facciolo, Legacy Giving Coordinator, Diocese of Wilmington

"With great power comes great responsibility" is a proverb popularized by Spider-Man in

Marvel comics and later attributed in film to Uncle Ben as advice to young Peter Parker.

This isn't just a pop culture idea or even a new one. From the 1^st Century BC Tusculan Disputations to Winston Churchill to Voltaire and to the 1973 French National Convention, some version of this saying has circulated throughout history. It's even in the Bible, appearing at the end of Jesus' Parable of the Faithful Servant as related in Luke 12:48.

But what does it mean for planned giving?

Plenty.

Sharing wealth and establishing a family culture of philanthropy are important values for many affluent households.

A 2025 Bank of America Study of Philanthropy revealed that 18% of charitable gifts were made through giving vehicles, up from 11% nine years earlier, 24% of affluent households have a giving vehicle, and 48% of affluent households with a net worth between $5 million and $20 million have or plan to establish a giving vehicle within the next three years.

DAFs vs. Private Foundations: A Comparison

Choosing the right vehicle for your post-death charitable contributions is just as important as deciding which charity to support. Two of the most common vehicles used by affluent individuals to manage their philanthropic activities are Donor-Advised Funds (DAF) and Private Foundations.

Donor-Advised Funds have increased in popularity in recent years. The 2025 Donor-Advised Fund reports show significant growth, with contributions up 37% to $89.6B in 2024, grants increasing 19% to $64.9B, and total assets soaring to $326 billion, driven partly by market growth and increased contributions of non-cash assets like stocks. DAFs are also becoming more accessible with lower minimums, and are a key tool for strategic, long-range giving.

A DAF is an account within a sponsoring public charity that allows donors to contribute assets which are managed by that organization which, in turn, makes donations to 501(c)(3) per the donor's request.

Indeed, one of the main disadvantages of a DAF is that donors do not have complete control over their investments. That's because, when you're ready to donate, you must present your request through the DAF board, which then approves or disapproves the donation Technically, then, your "donation" is more of a suggestion rather than a direct donation.

Private foundations, on the other hand, are independent, tax-exempt non-profit organizations funded by a single source like a wealthy family, individual or corporation.

Private foundations have complete control over their funds and are free to donate to a wide array of causes, including individuals, other charities, and their own programs. DAF donations must be made to a public or private charity.

DAFs allow donations to be made anonymously if privacy is a concern. Donations made from a private foundation must be acknowledged publicly in the foundation's annual report.

Both DAFs and private foundations accept cash and contributions of appreciated securities. But if you have hard-to-value illiquid assets, like artwork, real estate, or a classic car collection, a private foundation might be the better option.

Advantages of DAFs

The main advantage of a DAF is that it has few barriers to entry.

A DAF can be set up in less than a day, and often, with no minimum contribution or annual donation requirements.

Donating to a DAF is as easy as donating to any traditional charity because the sponsoring organization handles all the administrative tasks.

Setting up a private foundation, on the other hand, can be costly and time-consuming.

When you establish a private foundation, you need to determine how to structure the organization. This involves forming a governing body and creating legal documents that will guide the organization. Once the foundation is formed, you will need to satisfy all the administrative needs, such as hiring staff, bringing in investment managers, and fulfilling the mandatory reporting requirements.

Private foundations have the option of hiring family members as managers, creating a pattern of generational giving.

Private foundations are also required by the IRS to donate 5% of their assets each year. DAFs have no such requirement. Asses held in a DAF can grow tax-free for years before you choose to donate or pass them on to you heirs.

DAFs have grown in popularity over the past couple of years in large part because of their flexibility. DAFs enable giving where and when it's more beneficial, making giving more purposeful than impulsive and panicked.

While philanthropists are devoted to the causes they support and concerned about the efficacy of their donations, contributions also offer tax benefits.

With a DAF, donors can deduct up to 60% of their adjusted gross income (AGI) and the full market value up to 30% of their AGI.

Tax deductions are more limited in a private foundation and are capped at 30% of AGI for cash contributions and 20% of AGI for other contributed assets.

Which vehicle is right for you?

When choosing between a DAF and private foundation, you need to identify our philanthropic goals and take stock of your financial needs and circumstances.

Both DAFs and private foundations allow you to give in perpetuity if you choose: advisory privileges (DAF) or management (private foundations) can be passed on to succeeding generations.

A DAF is easier to set up and manage, as all administrative requirements are the responsibility of the account's supervisor. That way more of your donations go to charity rather than to overhead. DAFs also allow you to maximize tax benefits.

While DAFs have become more popular with individual donors, they've also gained favor with private foundations that use them for their donation requirements.

If a private foundation cannot meet its donation requirement, it can take 5% of its assets and donate them to a DAF. It can then make a donation from the DAF in the future or allow the funds to grow tax-free for years in the DAF.

As always, we recommend that you consult with a financial planning professional before making any major financial decisions.

If you have any general questions regarding the planned giving process, feel free to visit our planned giving page at cdow.giftlegacy.com or call the Office of Development at 302-573-3121.

By Christine Facciolo, Legacy Giving Coordinator, Office of Development, Diocese of Wilmington

Charitable giving isn't just about cutting your tax bill or getting rid of unneeded assets.

It's a powerful statement about what matters to you and how those values impact others.

We at the Diocese of Wilmington witness firsthand every day the transformative power of charitable giving. It's utterly amazing how a single act of generosity can change lives.

This desire to "pay it forward," to give back to our communities, is what gives our lives a sense of purpose. These benefits are amplified when entire families get involved. Family philanthropy is a powerful way for families to make a positive impact on society while also fostering unity and shared purpose across generations.

Two Popular Philanthropic Strategies for Building a Family Legacy of Giving

Once a family decides to give, the next step is choosing the right strategy. Below is a summary of two of the most accessible vehicles: Donor-Advised Funds and Charitable Gift Annuities.

Donor- Advised Fund

A Donor- Advised Fund (DAF) is an excellent vehicle for building a family legacy of giving. Creating a family legacy through a DAF is more than just financial contributions, it's about instilling values and ensuring that your family's charitable efforts have a lasting impact.

DAFs are "charitable checkbooks" that allow families to contribute assets and enjoy immediate tax breaks, even if the funds are distributed at a later date. Donors can contribute cash or other assets to a sponsoring organization and then decide which charities to support—and when. (Note: Most DAFs require a minimum initial contribution and a minimum grant recommendation which varies by charity. In addition, the maximum federal income tax deduction for individuals gifting DAFs with cash is 60 percent of Adjusted Gross Income. All contributions are irrevocable,)

This flexibility is what makes DAFs ideal for families wishing to make a significant impact over an extended period of time. Indeed, the purpose of a DAF is to provide donors with some leeway in planning, managing, and distributing their charitable grants. In this way, DAFs discourage impulsive giving in favor of strategic and meaningful donations.

For example, a donor may contribute an appreciated asset, which helps to eliminate or reduce capital gains taxes, and then elect to distribute the funds gradually to organizations that align with personal values. This deferral allows donors to time their distributions with philanthropic and estate planning goals.

In addition, funds invested with a DAF grow completely tax-free, allowing charitable contributions to increase significantly over time, thus enabling larger donations later.

A Word about DAF Sponsoring Organizations

The first step in setting up a Donor-Advised Fund is to select a reputable fund sponsor that aligns with your family's charitable goals.

Sponsoring organizations play a critical role in the administration and management of Donor-Advised Funds. These entities, be they community foundations or charitable funds hosted by financial services firms, are responsible for ensuring compliance with federal tax regulations, investing the funds, and facilitating the grantmaking process.

They also handle record-keeping, tax reporting, and legal compliance, relieving donors of these routine administrative tasks.

The National Catholic Community Foundation (NCCF) maintains a list of existing Donor-Advised Funds established by individuals and organizations on its website nccfcommunity.org/funds/.

Charitable Gift Annuity

A Charitable Gift Annuity (CGA) is another excellent vehicle for family philanthropy. CGAs ensure a legacy gift to a cause important to the donating family, while it offers a guaranteed, lifetime income for gifted annuitants.

A CGA is a contract between a donor and charity for lifetime payments. The donor makes an irrevocable transfer of cash or securities to a qualified charity. In return, the charity is contractually obligated to make fixed, regular payments to the annuitants for the rest of their lives. When the last annuitant passes, the remainder of the initial gift goes to the charity to support its mission.

Keep in mind that, per IRS rules, a qualified charitable distribution (QCD) from a traditional IRA cannot be used to fund CGAs that provide payments to non-donor, non-spousal annuitants.

In 2023, the Diocese of Wilmington partnered with the National Catholic Community Foundation which assumes administrative concerns and expenses for the diocese, providing donors with a seamless, risk-free experience.

Age is the main factor determining eligibility, payment schedules, and payout rates. Beneficiaries must be at least 40 years old to be eligible for a deferred CGA, but at least 55 to start payments. Payout rates increase significantly with age. Specific rates and minimums can vary by charity and current guidelines set by the American Council on Gift Annuities (ACGA) which can be consulted at aca-web.org for general estimates.

CGAs offer significant tax advantages for both donor and non-donor annuitant. Donors receive immediate tax benefits, including an income tax deduction for the charitable portion of the gift, potential capital gains tax avoidance or reduction if funded with appreciated assets, and lower estate taxes, if applicable.

The main tax advantage for a non-donor, non-spousal annuitant is the ability to receive a predictable, fixed income stream for life, where a portion of each payment is considered a tax-free return of the original principle for a specified duration. This can be especially beneficial for individuals in the lowest tax brackets, as the taxable portion of the income may be minimal.

CGAs offer an excellent strategy for family philanthropy. First, they link personal financial security with philanthropic goals, allowing families to support favorite causes while providing financial support for family or friends, making it a powerful tool for intergenerational giving and legacy building, especially when charitable giving is a top priority.

Engaging Family in a Giving Plan

Have family members express their giving goals. Ask each member to express their priorities in writing and rank them. This collaboration helps everyone feel connected to the process, ensuring that your giving aligns with your family's values and goals.

Give kids a voice. Be sure to involve children in the decision-making process. Ask them what causes they care about and why. This not only empowers them but teaches them the importance of philanthropy.

Assign research projects. Encourage family members, especially younger ones, to research various causes and organizations and report their findings. This is not only a great learning experience; it also helps everyone stay informed about the impact of philanthropy on an organization's mission.

Choose a Cause. Choosing a cause that has a personal connection to the family or community can make the act of giving more impactful and meaningful.

Choose a giving vehicle. Be mindful of how involved each family members wants to be in the process and select a giving vehicle that accommodates those wishes.

Encourage personal philanthropy. As younger members enter adulthood, encourage them to develop their own philanthropic goals and interests. Support them and celebrate their efforts and achievements.

Hold regular family meetings. These meetings can be used to discuss the impact of your giving and foster collaborative decision-making. This can be an annual, semi-annual, or quarterly tradition to review and evaluate philanthropic decisions and plan for the future.

By making charitable giving a family affair, you can create a legacy of generosity that endures for generations. It's never too early—or too late—to bring your family together in giving while making a positive impact on the world.

Talk with a Professional

As always, we recommend that you consult a financial planning professional before making any investment decisions. If you have any questions about planned giving, feel free to contact the Office of Development at 302-573-3121 or visit cdow.giftlegacy.com.

By Christine Facciolo, Legacy Giving Coordinator, Diocese of Wilmington

Our current economic climate is challenging, to say the least.

Rising inflation, a weakening labor market, and financial instability have increased reliance on nonprofit services while decreasing disposable income, causing some donors to prioritize their own needs over charitable giving.

It may seem counterintuitive, but in tough economic times, people actually become more intentional in prioritizing their charitable giving.

A Harris Poll conducted for Vanguard Charitable in October 2025 found that some 70 percent of Americans donated to charity during the first half of 2025, with 87 percent of them saying they would donate the same amount or more by the end of the year, despite economic uncertainty.

In addition, more than 1/3 of poll respondents say they are donating because they believe it is their civic duty to support the causes that matter most to them during times of economic stress.

A report from Neon One estimates that December giving accounts for roughly one-fifth of a nonprofit's annual revenue. This year, many organizations are unsure of what to expect during this "giving season," let alone next year in the face of government cuts. Giving during these uncertain times helps charities plan with more confidence as they strive to keep people housed and fed.

For those who remain skittish to give, planned giving provides options for them to remain financially comfortable while staying the course with their long-term giving strategy.

Two vehicles, charitable gift annuities and donor-advised funds, are advantageous strategies during tough economic times, but each serves different donor needs and philanthropic goals.

Charitable Gift Annuities: A Win-Win

A charitable gift annuity (CGA) is a good option for those who like the idea of an upfront tax deduction, the peace of mind of a lifetime guaranteed income, and a remainder gift to charity.

If you have not already considered a CGA, now might be the time to do so.

A CGA, like any other annuity, is a contract. You agree to make an irrevocable transfer of cash, assets, or a qualified charitable distribution from your traditional IRA to a qualified charitable organization. In return, the charity agrees to pay you or your designated beneficiary a fixed payment for life. You are eligible for an immediate tax deduction for the present value of the future amount going to the charity.

CGAs have been around for more than 100 years. They were in vogue in the 1990s and again in 2008. They are now experiencing another round of popularity for the following reasons:

• Payout rates are at all-time highs
• An option to fund with an IRA QCD, potentially satisfying an RMD
• Key tax advantages over other plans

In November 2023, the Diocese of Wilmington partnered with the National Catholic Community Foundation to manage CGAs, facilitating financial support for Catholic school tuition assistance programs and the diocese's Faith and Charity Catholic Appeal ministries.

The collaboration eliminates administrative responsibilities and expenses for the diocese, providing donors with a seamless, risk-free experience.

CGAs offer a variety of benefits to both donors and charities as they navigate an unstable economic environment. For donors, CGAs offer a guaranteed, fixed stream of income for life, making them an attractive investment option in times of market turbulence.

CGAs benefit charities by being easy to administer, and the remaining assets provide a significant gift after the annuitant(s) pass. CGAs also build strong relationships with valued donors.

Donor-Advised Funds: Built to Weather Turbulent Times

A donor-advised fund (DAF) is a planned giving vehicle that allows investors to donate directly to a charitable fund, while retaining some control over the assets. DAF fund administrators are public charities that qualify as Section 501©(3) organizations.

There are several main types of donor-advised funds: those administered by a specific charity directly; those administered by a community foundation or religious organization, such as Catholic Charities; and those administered by an organization associated with a financial institution.

DAFs have become increasingly popular in recent years. The National Philanthropic Trust reports that the total charitable assets in DAFs reached $251.52 billion in 2023, an increase of 9.9 percent from 2022, driven by donor contributions and market gains.

Donors receive an immediate tax deduction when they contribute cash or other assets-except IRA QCDs-to the fund. Although contributions are irrevocable, the donor still retains an advisory role. Accountholders can make contributions all at once or over time, and to a single charity or a variety of charitable organizations,

This flexibility is what makes the DAF so attractive, especially in a challenging economy. In uncertain times, the most powerful thing a donor can do is give with intention. But market fluctuations, shifting government policies, and changing nonprofit needs, can disrupt even the most well-strategized giving plan, resulting in a kind of reactive giving that disrupts long-term goals.

DAFs offer a middle ground. These vehicles allow donors to contribute when it makes financial sense for them, while giving them the time and space to decide how and where to distribute these funds.

Here's how DAFs help donors plan with purpose:

• Timing. Donors are free to make a tax-deductible contribution today, and decide, proactively, when to recommend grants later.
• Flexibility. DAFs can support multiple causes and evolve as donor interest and community needs change.
• Stability. DAFs allow donors to maintain a consistent giving rhythm even as their personal finances fluctuate. Donors can build funds during more prosperous times then draw from them during leaner seasons, ensuring an adherence to their long-term philanthropic goals.
• Faith. A DAF can help ensure that your philanthropic goals align with the values of your faith.

In an uncertain economy, the most effective giving strategy is one that gives with purpose and intention. DAFs make it easier to be thoughtful and proactive with your giving rather than reactive and impulsive. Whether you're responding to a crisis, planning for the year, or building a long-term legacy, DAFs can help you donate with clarity and purpose.

By Christine Facciolo, Legacy Giving Coordinator, Diocese of Wilmington

Time was when retirement meant leaving your job, pulling up stakes, and trotting off to some dream retirement destination.

Not anymore. Many retirees view their golden years as a golden opportunity to make a lasting impact on the causes and organizations they care about.

Not surprisingly, Baby Boomers are, once again, leading the charge. A recent study by Fidelity Charitable found that the majority of this cohort place a high priority on charitable giving, with generosity a key source of happiness and fulfillment.

However, while generosity has its merits, it is essential that your philanthropy does not jeopardize your own financial future.

Finding the right balance between generosity, personal fulfillment, and long-term financial security is an ongoing process that requires careful planning to incorporate the right mix of smart gifting strategies into your estate plan. Planned giving can be a powerful way to do just that. This blog will explore several strategies that allow you to support the organizations and causes you care about without compromising your financial well-being.

1. Bequests
   One of the most popular planned giving vehicles is simply a bequest in your will. Just as you would bequeath certain assets and items to an individual, you can choose to establish a bequest to a specific charity. Bequests to qualified charities can significantly lower estate taxes, if applicable, by being fully deductible from the estate's gross value.

2. Private Foundations
   Long the province of the wealthy, private foundations disperse charitable funds primarily by making grants to public charities, but, since they don't rely on donations, they also have the option of giving to individuals for scholarships and special projects. In addition, they sometimes conduct their own charitable activities.
   Private foundations offer significant opportunities for philanthropy, but their reporting and administrative responsibilities require meticulous attention to ensure compliance and to facilitate effective charitable endeavors. A private foundation can exist in perpetuity, creating a family legacy and fostering family engagement.

3. Donor-Advised Funds (DAFs)
   A donor-advised-fund (DAF), also known as a "charitable checkbook," allows individuals to make an irrevocable contribution, receive an immediate tax deduction, and recommend grants from the fund over time. Assets in the DAF can be invested, potentially increasing the value of your contributions over time. Like private foundations, DAFs offer the opportunity for family engagement but without the expense and administrative burdens. This is an excellent option for retirees who want to make a significant impact without giving away too much at once.

4. Life Insurance
   Leveraging unneeded life insurance policies is another way to support a charity during retirement. By naming a charity as beneficiary of your life insurance policy, you can make a significant contribution without affecting your current cash flow.
   
   You can either transfer an existing policy to a charity or establish a new policy with the charity as the beneficiary. In either case, the death benefit is removed from your estate, which can help reduce any applicable estate taxes.

5. Qualified Charitable Deductions (QCDs)
   The qualified charitable deduction (QCD) is another planned giving option for charitable giving in retirement. It allows individuals aged 70 ½ or older to transfer up to $108,000 (in 2025) directly from a traditional IRA account to a qualified charity, tax-free. Married couples filing jointly can each make a QCD of up to $108,000 for a combined total of $216,000. The amount of the QCD is excluded from your taxable income, which can help lower your overall tax liability. This strategy benefits retirees who do not need the income from their RMDs for daily living expenses and would rather use the funds to support their favorite charity.

6. Charitable Gift Annuities (CGAs)
   A charitable gift annuity is an estate planning strategy that allows you to make an irrevocable gift of cash, securities, or real estate in exchange for a predictable income for you or another person. You may be eligible for a partial charitable deduction for the year in which you set up the CGA. A portion of the income from the CGA may also be tax-free.
   
   Funding with appreciated assets can offer tax benefits by avoiding capital gains tax on the portion that would have been due if sold.
   
   You can also fund a CGA for yourself and another beneficiary through a one-time QCD of up to $54,000 (in 2025) from a traditional IRA. When you and the other beneficiary pass away, the remaining principle goes to the charity.
   
   A CGA can be a good strategy for retirees who want a guaranteed income stream for life while supporting a charity and can afford to make an irrevocable contribution to fund it.

7. Charitable Remainder Trust
   A charitable remainder trust (CRT) is a more sophisticated planning tool that allows you to support a charitable cause while providing you or your beneficiaries with an income stream for a certain period of time After that, the remaining assets in the trust go to the designated charity.
   
   You may receive a charitable deduction based on the projected remainder that will go to the charity. If you establish the trust with appreciated assets, you may avoid paying capital gains taxes on the sale of those assets within the trust. A CRT is an ideal option for retirees who want to support a charitable cause but need to generate an income for living expenses. Bear in mind that a CRT is irrevocable, meaning it is difficult to change and once the donation is made, you will no longer legally have control over the assets in the trust.

8. Charitable Lead Trust (CLT)
   Essentially the reverse of the charitable remainder trust, a CLT allows you to donate money to a charitable organization for a specific period of time before giving the remaining assets to your family or other beneficiaries. A tax deduction for a CLT depends on whether it's a grantor trust, which allows for an immediate tax deduction, or a non-grantor trust, which does not provide an income tax deduction to the donor. The assets that remain in the CLT upon its termination go to the your family, free of estate or gift taxes. CLTs can benefit investors who want to generate income for a cause. Both CRTs and CLTs can be funded with QCDs.

Additional Strategies

Bunching
Bunching charitable deductions is a strategy that involves combining years of charitable contributions into a single tax year. This can allow you to itemize deductions in that year to exceed the standard deductible threshold, while taking the standard deduction in other years. Bunching is a popular strategy for funding a donor-advised fund.

Appreciated Assets
Donating appreciated assets, such as stocks or real estate, allows you to avoid capital gains taxes and deduct the fair market value of the asset Donating a low basis stock, i.e., one whose original purchase price (the basis) is much lower that is current market value due to appreciation, can sometimes provide more tax benefits than a QCD. Even modest gains in an asset's value can generate significant tax advantages for charitable giving.

Conclusion

Charitable giving during retirement does not have to be an either-or decision between the desire to support your favorite organizations and causes or the need to maintain your financial security.

A well-constructed estate incorporating the right combination of planned giving vehicles that suit your unique needs and goals can help you give back without draining your finances.

Not sure where to start? As always, we recommend consulting a qualified estate planning professional to guide you through the process.

If you have general questions or would like to get an overview of the planned giving process, you may visit our website at cdow.giftlegacy.com or call the Office of Development at 302-573-3121 for more information.

It's April, the month we turn our attention to taxes and finances. It's a time when the practical aspects of money come into sharp focus, offering us an opportunity to take a closer look at our relationship surrounding money and faith.

For Catholics, this might involve examining how we view our wealth and its capacity to enrich our philanthropy.

Gift giving is the foundation of our faith. The biblical record chronicles God's activity as the supreme gift giver and demonstrates how people of faith have responded with gifts of their own. This "gifting" serves as a powerful motivator for our own response to God's bounty in our lives.

But Catholic generosity is lagging that of other religious groups.

Several studies have shown that, over the years, Protestants have given more to their churches than Catholics do. For example, a national study in 2003 showed that Protestants gave an average of 2.6 percent of their income to their church, while Catholics gave an average of only 1.2 percent. A similar "giving gap" has been found in other studies as well.

A 2013 study by the University of Notre Dame examined the factors that affected the level of people's giving to their churches. That report, "Unleashing Catholic Generosity: Explaining the Catholic Giving Gap in the United States," identified four main factors related to giving:

• Level of church attendance and religious involvement.
• A congregational culture focusing on mission and spiritual growth vs. just "paying the bills."
• Regular communication about parish mission and goals, i.e., imparting a sense of 'ownership" among the congregants.

The most important factor explaining the "giving gap," though, according to the authors, is a lack of "spiritual engagement" among the majority of American Catholics. Rather than seeing their use of money and possessions as part of their spiritual life—as part of Christian formation and faithfulness—Americans tend to "compartmentalize:" They tend to separate money from matters of faith and to think that money and material possessions have nothing to do with spiritual or religious issues.

Just how close-fisted are American Catholics? The Notre Dame study found that Catholics in the survey donated, on average, $501 in the previous 12 months, as opposed to $985 for the average non-Catholic respondent.

The report also noted that while the "giving gap" is largest in religious giving, it also exists in other aeras of philanthropy. Catholics also rank near the bottom, below members of other religious traditions, in terms of donations to non-religious causes. Overall, the study found that American Catholics gave significantly less on average than other religious groups. Moreover, the typical American Catholic donates less than the average American.

Granted, the data in the report is more than ten years old. But the research raises the question of whether the Catholic parishes are effectively communicating a long-term vision of philanthropic giving and whether those sitting in the pews truly grasp the meaning and power of stewardship.

Catholic pastors grapple with the challenge of addressing the immediate needs of their parishes with fostering a long-term vision for growth and sustainability. Meeting immediate needs is crucial, but neglecting a strategic, long-term plan can fail to imbue parishioners with a sense of commitment to stewardship, thus hindering the growth of the parish community.

Meanwhile, Catholics themselves have long been buffeted by mixed messages about wealth. Jesus, the son of a poor carpenter in a poor province of the Roman Empire, said, in Matthew, "You cannot serve both God and money," and "It is easier for a camel to go through the eye of a needle, than for a rich man to enter the kingdom of God." St. Augustine, renowned theologian, writer and doctor of the Church, likened the love of money to idolatry, which was, in his time, an offense punishable by death.

This view of wealth took root in the scarcity of biblical times. Early Christians were, no doubt, appalled by the widespread poverty in which they lived, and hoped for a time when there would be enough to go around for all God's people to enjoy the gifts of his creation.

A spiritual mindset around money requires conditions of growth and abundance. Whereas a mindset of scarcity breeds feelings of fear and anxiety, a mindset of abundance cultivates gratitude, trust and the belief that there is enough to go around, allowing us to use money in accordance with Christian values, supporting causes we believe in, investing in personal growth and practicing generosity.

Today, wealthy Catholic families like the Kennedys, the Healeys, the Raskobs and the Rauenhorsts have demonstrated good stewardship of their wealth by establishing foundations to support causes like healthcare, education, global development and economic security.

For people of faith, estate planning is a key component of stewardship. Wealth well-stewarded is realizing that everything we are and everything that we have belongs to God and that we are mere stewards of those gifts.

The same principles apply to our estate planning. Planned giving means the stewardship of our assets, our estate plan being our last act of stewardship.

When you hear about estate planning, you think of large donations and believe that type of transformative gift is beyond the scope of what you can give. But the truth is, you have the same means as your disposal to make an impact. Planned giving is transformational giving. Planned giving is for everyone regardless of the size of the estate.

Simply put, planned giving is a way for individuals to donate to the Church, either during their lifetime or after their death, as part of an overall financial plan. Planned gifts come in all shapes and sizes and fall into three categories:

• Outright Gifts (cash, bequests, personal property, IRAs)
• Life Income Gifts (Charitable Gift Annuity, Charitable Remainder Trust)
• Gifts that Protect Assets (Retained Life Estate)

Planned gifts are typically the largest gifts donors make in their lifetime. Planned gifts are often 200 - 300 times the largest annual gift that donors make during their lifetime. Moreover, the average size of a charitable bequest, the most common type of planned gift, is $78,630, according to The Chronicle of Philanthropy. Gifts of this magnitude ensure a steady stream of income for the Church and tax advantages for donors and their heirs.

But planned gifts extend beyond simply donating money. It empowers individuals to choose the way they want to be remembered, and the impact they want to leave on future generations, in terms of their values, character and the way they shared their worldly God-given gifts with others.

While money is an important part of planned giving, it is not its sole measure. It also involves setting an example and mentoring the next generation of philanthropists, for if American Catholics become less charitable, what does that mean for the Church, and for society?

By , Christine Facciolo Legacy Giving Coordinator, Office of Development, Diocese of Wilmington

We're about to delve into a topic that makes many of us uncomfortable. Death.

No one wants to think about their own mortality or the time when loved ones will no longer be with us.

But death is inevitable. It's the only thing no one can avoid.

Getting comfortable with death, though, has its advantages. Talking about death helps us plan for the inevitable. Having a will or trust in place provides peace of mind and lightens the burden for our loved ones after we pass.

Confused about wills and trusts? You're not alone. Both wills and trusts help direct what happens to the assets you've worked so hard to build. But they're vastly different. A will guides the distribution of those assets after your death, while a trust can be opened and administered during your lifetime and continues administering and distributing assets even after you're gone.

Here are some key differences between the two to help you decide which better satisfies your needs.

Wills

A will, or last will and testament, is a legal document that specifies what you want done with your assets and minor children after you pass. It is essentially a roadmap for the probate process, which validates the will and ensures that all estate debts are paid, and the deceased's wishes honored. If you die without a will, or intestate, the intestacy laws of your state will decide who gets what from your estate and who will act as guardian of your minor children.

If you are an adult who wants control over your assets, you need a will, but there are three groups of people for whom having a will is essential:

• Married couples — Being married does not automatically guarantee that your spouse willinherit the entirety of your estate. If you die without a will, your spousewill inherit a significant portion of your assets, but biological childrenfrom previous relationships and other survivors, like living parents, willshare the rest. AARP recommends that married couples maintain separatewills, even if their wishes are similar. If one spouse predeceases theother, the surviving spouse could be bound by the directives in the jointwill, which may or may not align with their wishes.

• People with property/pets — You probably own more than you think. If you die without a will, the laws of your state will decide how your possessions are distributed. If these people cannot be found, your possessions become the property of the state and, again, parceled out according to its laws. If you have pets, you may name and fund a guardian for their care, but, unlike a pet trust, the agreement is not legally enforceable and is subject to probate, which can take time.

• People with children — If you have minor children, i.e., children under the age of 18, a will allows you to name a guardian as well as a successor if that person is no longer able to fulfill the role. Without a will, the state will appoint a guardian, and that person may not be the one you would have selected.

A will is one of the most important documents you will ever create. Yet many people make critical mistakes during the process&8212;mistakes that can lead to confusion, legal disputes, or even an invalid will. Here are some of the top mistakes estate planning attorneys suggest you avoid to ensure your final wishes are honored.

• DIY-ing it — DIY wills, while seemingly convenient and inexpensive, can result in unintended consequences and costly legal battles, making expert assistance from a qualified estate planning attorney a worthwhile investment.

• Not accounting for digital properties — Digital assets, such as social media accounts, online banking and cryptocurrency accounts, are often left out of wills. Without proper instructions, these assets can become inaccessible and fall into the wrong hands. Be sure to include a plan for managing and transferring digital properties.

• Not naming alternate beneficiaries — If your designated beneficiaries predecease you or disclaim their inheritance, this can cause some beneficiaries to receive more than you intended or reliance on state intestacy laws.

• Not providing for minor beneficiaries — A beneficiary must be 18 years of age to inherit directly in Maryland and Delaware. There are ways under each state's Uniform Transfer to Minors Acts to leave your estate to a minor beneficiary. Failure to make proper arrangements can result in the money you leave being managed by someone not of your choosing.

• Omitting biological children — You are not bound to include your children in your will. If you want your children to receive a share of your estate, it is important to specifically name them in your will. The probate court will honor the will as it is written. If biological children are not mentioned, including those from previous relationships, they are out, unless they can prove fraud, duress or outside influence. Adopted children are treated the same as biological children.

• Being too vague or too specific — Wills must be clear and specific to avoid confusion, conflict, and potential challenges. Clearly naming all beneficiaries and assets, and specifying what goes to whom and how, can make life a lot easier for your heirs. Conversely, your will may also contain assets that you no longer own. Updating your will can avoid those issues.

• Inconsistency — Beneficiary designations found on life insurance, retirement plans, payable-on-death or transfer-on-death accounts override a will's instructions for those assets. It is essential that you coordinate these designations with your will to ensure that your overall estate plan is caried out as you intended.

• Not updating the will — Neglecting to review your will after life events like marriage, divorce, family, and financial shifts can result in a document that no longer reflects your wishes. Updating your will with an attorney helps keep it current and enforceable.

While a will is a simple and relatively inexpensive way to transfer assets, it does have several disadvantages. Here are a few:

• Probate — Probate is the process by which wills are validated and assets distributed. Probate can be time-consuming and costly.

• No Privacy — When a will enters probate, it becomes public information, accessible to anyone, even creditors, creating privacy concerns for some individuals and families.

• No protection from creditors/taxes — A will does not protect assets against creditors or help minimize taxes.

• No protection during incapacity — A will only takes effect after death, so it does not address issues resulting from illness or injury. A durable power of attorney is needed to address these issues.

• Limited control over asset distribution — Wills govern the immediate distribution of assets after death. This creates a problem if there are beneficiaries not yet capable of managing an inheritance or if you prefer to distribute assets over time.

• Limited flexibility — Wills are relatively inflexible and may not be suitable for complex estate-planning needs.

• Potential for challenges — Wills can be contested by disgruntled heirs who feel they were excluded or unfairly treated, leading to family disputes, legal battles, and delays. Common grounds for challenges include claims of undue influence, mental incapacity, or improper execution.

Trusts

A trust is a legal entity that manages your assets and distributes them according to the terms of the trust. Unlike a will, a trust can become effective while you are alive and continue to operate after you've passed. There are several different kinds of trusts including:

• Revocable trusts — Also known as a living trust, this type of trust is common in estate planning. This type of trust allows the grantor to retain control of the assets during life, specify what happens to those assets at time of death, and avoid probate, which can be time-consuming and expensive. Additionally, the grantor can change the trust at any time, including making changes to the trust's beneficiaries, modifying how the assets are distributed, and even dissolving the trust altogether.

• Irrevocable trusts — As its name suggests, this type of trust cannot be modified or terminated by the grantor. The grantor also forfeits control of the trust's assets. Changes to an irrevocable trust can only be made with the consent of all beneficiaries. Irrevocable trusts are set up to reduce estate taxes, protect assets from creditors, or to set conditions for a gift that could not be set up in a will.

• Special needs trusts — Special needs trusts are arranged to provide financial support for individuals with special needs without disqualifying them from Medicaid and Supplemental Social Security Income. The trust must be established prior to the individual turning 65.

• Spendthrift trusts — A spendthrift trust works to protect a beneficiary's inheritance or assets from their poor financial habits, creditors, and potential legal judgments.

Both special needs trusts and spendthrift trusts are managed by a trustee who manages and distributes the assets according to the terms of the trust. The trust's beneficiary has no control over the assets in the trust, and the trustee is held to strict guidelines to ensure that the trust is used solely for the benefit resulting from their special needs and circumstances.

Benefits of a Trust

Trusts offer many benefits than wills. Trusts:

• Avoid probate — Unlike wills, trusts bypass the probate process, which helps ensure that your estate is settled quickly, inexpensively, and, privately.

• Offer flexibility — Trusts allow grantors to attach conditions on how and when assets are distributed to beneficiaries.

• Provide for pets — Both Delaware and Maryland have laws that enable pet owners to create legally enforceable trusts for the care of animals alive during the owner's lifetime. These arrangements allow for the designation of a guardian for the pet, as well as the allocation of funds for the pet's food, medical expenses, and grooming.

• Provide for incapacity — A revocable living trust is designed so that your successor trustee can step in without court involvement or the need for additional documents, ensuring that your wishes are followed seamlessly.

• Avoid challenges — While not immune to challenges, a trust can significantly reduce threat of challenges by careful construction, proper funding and ensuring transparency with beneficiaries.

• Offer tax advantages — Depending on the way the trust is structured, a trust can offer a variety of specific tax benefits and advantages, including income tax savings, reduced estate and inheritance taxes, gift tax exemptions, and asset protection.

• Permit funeral planning — Since trusts are active during the grantor's lifetime, the trust can outline specific funeral wishes, including the type of service and funeral arrangements.

Disadvantages of a Trust

• Cost — Setting up a trust can be time-consuming and expensive, requiring attorney fees and continuing administrative costs.

• Loss of control — Unlike a revocable trust, an irrevocable trust is designed to be permanent, and the assets transferred to it are generally removed from the grantor's ownership in exchange for certain benefits, like protection from creditors' claims.

• Funding issues — Transferring assets into a trust requires meticulous planning and paperwork. Failure to properly fund a trust can render it ineffective, making those assets subject to probate.

• No provisions for guardianship — While a trust can be used to manage assets for minor children, a will remains the primary legal document for naming a guardian. Trusts can be used in conjunction with a will to manage the inheritance for those children, but a "pour-over" will is necessary to designate a guardian who will be in charge of their care.

If you're at the beginning of the estate planning process, you might be wondering which is better. That depends on your individual needs and the value of your estate.

If your estate is worth less than $1 million, has easily transferred assets and simple bequests, a basic will is probably all you need.

If, on the other hand, you have a complicated estate worth more than $1 million, a need for privacy, tax benefits or asset protection, a trust might be the better option.

Even with a well-structured trust, though, a "pour-over will" is needed to catch assets not included in a revocable trust at the time of death. These can include:

• Any asset acquired after the trust's creation.
• Personal property like furniture or collectibles not explicitly mentioned in the trust.
• Assets overlooked or forgotten.

Estate planning is too important to be left to the novice. Estate planning laws are complex and vary by state. Working with an estate planning attorney ensures that your plan is comprehensive, legally compliant, minimizes taxes, and protects your loved ones and legacy. If you have questions regarding wills or any other planned giving vehicle, please visit our planned giving website at cdow.giftlegacy.com or call the Office of Development at 302-573-3121 or 302-295-0644.

By Christine Facciolo, Legacy Planning Coordinator, Diocese of Wilmington

What is a QCD?

The tax man is coming for IRA owners turning 73 this year, especially those who have accumulated significant wealth in their accounts. They must now begin withdrawing a minimum amount of taxable funds from their accounts annually. These required minimum distributions (RMDs) can trigger significant tax liabilities, disrupting long-term financial strategies and estate planning.

It sounds scary, but the IRA RMD may not be as required as you think.

If you are charitably inclined, and at least 70 ½ years old, a qualified charitable distribution (QCD) can further your philanthropic goals and protect your retirement nest egg from RMD taxes.

Despite these benefits, the QCD has often been overlooked in financial planning by both retirees and financial advisors. Many retirees, especially those who do not have a financial advisor, are simply unaware of the strategy. Even while working with a financial advisor, benefit can be missed due to the complexity of its rules and the failure to report it properly. In addition, the increase in the standard deduction may have caused many people to stop itemizing charitable deductions, so they may think that charitable giving is no longer of any benefit.

QCDs may gain in popularity, though, thanks to the One Big Beautiful Bill Act. A key provision in this legislation, passed in July, includes a significantly higher

standard deduction, weakening the case for itemizing charitable deductions. That makes the case for QCDs more compelling than ever, especially for retirees with stable incomes and limited itemized deductions.

QCDs and RMDs

Understanding QCDs begins with an understanding of RMDs. The RMD is the government's way of "recouping" taxes on retirement savings. RMDs ensure that taxes, which were deferred for decades on contributions and earnings in traditional IRA accounts, are eventually paid to the U.S. Treasury.

As IRA owners reach the age of 73, they must start withdrawing the money that was contributed tax-free and all subsequent earnings, whether they need the funds or not.

Retirees may not want to withdraw the funds for a variety of reasons. They may have other sufficient sources of income that cover their day-to-day expenses. In addition, the withdrawal, which is subject to ordinary income tax, may push them into a higher tax bracket, impacting Social Security benefits, Medicare premiums, and other investments.

Failure to take the RMD incurs severe penalties. The IRA imposes a stiff 25 percent excise tax on any amount of the RMD not withdrawn by the deadline. For example, if your RMD is $5,000 and you fail to make the withdrawal, you owe the IRS a $1250 penalty on top of your regular tax liability. The penalty can be reduced to 10 percent if the error is corrected within two years.

For many IRA owners, the mandatory withdrawal is not an issue. They may want-or need-- to take the money out each year because they rely on it to pay their living expenses.

But individuals with well-funded accounts are not so willing and can be downright resentful about the government's telling them what to do with their money and when. For charitably minded individuals and couples in this group, the QCD is an appealing, tax-smart strategy.

The QCD allows a donor to instruct their IRA administrator to transfer all or part of their RMD to a qualifying charity. In 2025, the limit is $108,000 per individual. Couples who file joint tax returns qualify for a potential total of $216,000. The limit is adjusted for inflation.

The SECURE 2.0 Act passed in late 2022 expanded the role of the QCD by allowing a one-time transfer, indexed for inflation, to certain life-income plans, like the charitable gift annuity and the charitable remainder trust. The limit for 2025 is $54,000 for an individual. Married couples can transfer the amount each from their individual accounts for a total of $108,000.

Since the IRA assets go directly to the charity, donors don't report QCDs as taxable income and don't owe any taxes on the QCD, even if they don't itemize deductions. Some donors may even find that QCDs offer greater tax savings than cash donations for which charitable deductions are claimed. This is because adjusted gross income (AGI) is reduced, and AGI is used in several key calculations, such as determining the taxable portion of Social Security benefits, Medicare premiums, and net investment taxes.

Common Mistakes to Avoid When Making a QCD

The QCD is a powerful strategy for creating ministry while minimizing tax liabilities in the retirement years, but only if it's done correctly. Here are some common mistakes to avoid when implementing a QCD:

1. Making the transaction too soon
   An IRA account holder must be 70 ½ to implement a QCD strategy. Unlike the RMD rules, which take effect when an individual reaches the age of 73, QCDs are based on the actual date you turn 70 ½—not the year you attain this age. For example, if you were born on January 1, you would not be eligible to make a QCD before July 1. If you try to make a QCD prior to reaching 70 ½, the entire transaction will be treated as taxable income, and you won't be able to retract the transaction.

2. Using the wrong account
   QCDs can only be applied to certain retirement accounts. Comon vehicles for QCDs are traditional and inherited IRAs. SEP IRAs and SIMPLE IRAs can only be used if they are "inactive" plans, i.e., plans that receive no contributions in a given tax year.

3. Transferring between spouses
   Each spouse must individually elect to use their $108.000 limit when making QCDs. Neither can transfer the other's unused benefit to make $216,000 in a single year. The same rule applies to funding a life-income plan.

4. Not sending funds directly to charity
   A fixed rule of QCDs is that the transfer must be made directly to the charity from the IRA administrator, typically via a check made to the organization. If the owner making the distribution makes the check payable to themselves, then gifts the funds to charity, they disqualify the funds from being treated as nontaxable income

5. Failing to communicate and report
   Communicating with your accountant is essential to ensure that your QCD is properly recognized as a nontaxable distribution. Failure to report the QCD on your 1099 form, which does not distinguish between the various types of distributions, can lead your financial advisor to treat the QCD as an ordinary taxable distribution. Communicating with your accountant early in the process regarding your intentions to make QCDs can mitigate this risk and prevent potential headaches down the line.

It's a question you might well be asking yourself every time you donate to a fundraising appeal: Am I being charitable enough? What portion of my income should I devote to charitable giving? What's the "norm?"

If you're like most Americans, you gave just under 2 percent of your disposable income to charity in 2023, according to a 2024 report from Giving USA. Some religions stipulate 10 percent of an individual's income be given to charity, while others recommend donating half that amount.

It makes perfect sense to consider income when budgeting for charitable donations. The amount of money coming in determines the amount of money that can go out.

But income may only represent a small slice of your giving potential. A much better measure for what you can give to charity is your wealth. While donating cash may be simple and efficient, thinking about charitable giving can be limiting because less than 10 percent of household wealth in the U.S. is held in cash. That means a whopping 90 percent of the nation's wealth is held in non-cash assets.

Thinking about donations in terms of income is especially limiting to both older donors, who have little disposable income during retirement, and younger donors who have not yet reached their full earning potential but still want to make a difference.

Tapping into wealth allows both groups to achieve their charitable goals, as it frees them to look beyond the limits of cash and cash equivalents. Indeed, just about anything you own can be used to make a gift to a qualified charity. Examples of IRS-defined capital assets include:

• Marketable securities

• Mutual funds

• Real estate

• Collections (stamps or coins)

• Jewelry

• Art/Antiques

• Precious metals

• Cryptocurrencies

By donating a non-cash asset to a qualified charity:

• You pay no capital gains or healthcare tax.
• The asset is no longer part of your estate, saving estate taxes.
• You save the expenses of maintaining, storing, insuring, or repairing the asset.
• You receive an income tax deduction (up to 30 percent of adjusted gross income).
• You receive the personal satisfaction of knowing you supported a worthy cause.

Whereas using one's income as a benchmark for charitable giving implies a year-by-year approach, tapping into wealth offers a more long-term perspective that benefits both donors and charities.

For charities, finding and maintaining sources of funding is the most difficult and time-consuming task of all. We're all familiar with the old saying: "Don't put your eggs all in one basket." A charity relying on annual gifts is doing just that. And should the basket drop, eggs will be broken.

A sizable donation in the form of an appreciated, non-cash asset, on the other hand, can transform an organization's financial landscape, putting it on firm footing should for long, and sometimes, rocky road ahead.

Gifts of non-cash assets have enormous potential for good because charities, unlike regular folks, do not have to pay capital gains taxes when the appreciated asset (if held for longer than a year) is sold.

For donors, a gift of an appreciated asset allows them to make a large gift to benefit the charity, often more than they would otherwise be able to donate. A gift of appreciated assets allows donors to preserve cash for future or immediate needs.

Moreover, a gift that is planned enables donors to integrate the gift into their overall financial, tax and estate planning.

To learn more about making your assets work for you or any other planned giving option, feel free to contact the Office of Development at 573-3121.

Thank you for your interest in supporting the mission of the Diocese of Wilmington.

Have you looked at your will lately?

A will is a critical part of any estate plan, and arguably, the most important document you will ever write. But a will is not a one-and-done activity. Families undergo all sorts of changes, and those changes can render the most well-crafted document outdated.

Are you in the "have-it-done-but-need-to-update" category? Financial planning attorneys recommend you revisit your will every five years, whether you've experienced a life-changing event or are simply reassessing your goals. Why not use the occasion of your mid-year money check-up to ensure that your will remains aligned with your wishes and values.

Key reasons to update your will include:

1. You marry or remarry. You must include your spouse in your will, as primary beneficiary, along with any new financial or legal responsibilities, to ensure that they inherit the entirety of your estate. Most states, including Delaware and Maryland, award a certain percentage of an estate to the surviving spouse, the remainder to be distributed among surviving parents and children. If you want your spouse to inherit more, you must name them in your will. If you remarry, you need to amend your will to include your new spouse, and any biological children you share with your former spouse. You might also want to include any members of the blended family.

2. You divorce. You should remove your former spouse from your will immediately after a divorce. In Delaware and Maryland, a divorce generally revokes any provisions that benefit the former spouse, meaning that, after a divorce, your former spouse will be treated as if they pre-deceased you. The remaining provisions of the will remain intact. It is crucial that you review and update beneficiary designations on life insurance policies, retirement accounts, and any other assets to reflect your current wishes.

3. You have/adopt children. Having or adopting a child necessitates amending your will to include them as beneficiaries and to appoint a guardian should both parents pass away while the children are still minors. In the case of adopted children, confirm that all legal rights are reflected in your will to ensure they are treated equally as biological children.

4. Your child reaches the age of majority. In most states including Delaware and Maryland, children reach the age of majority when they turn 18. However, parents may feel that an 18-year-old is not prepared to manage an inheritance and choose to delay or distribute the assets in stages. You might also want to consider the unique needs and concerns of the adult child.

5. Your child marries. Marriage creates blended families and along with it, inheritance issues. It's crucial for parents to update their wills to consider the impact of the child's marriage on existing beneficiaries and to ensure that their individual willsi reflect the parents? intentions regarding inheritance and asset distribution. It is essential that steps be taken to prevent the child's inheritance from becoming part of the new couple's marital property, subjecting it to divorce and liability claims.

6. You have grandchildren. When you name grandchildren in your will, you must specify whether you mean all grandchildren or the specific offspring of certain parents. It's also recommended that you specify a distribution per stirpes to ensure that if a beneficiary dies, their share of the inheritance passes to their descendants, rather than returning to the remaining beneficiaries

7. Your beneficiary has a major life change. Has a beneficiary pre-deceased you, fallen ill or into debt, developed substance-abuse issues, dementia, or otherwise become unable to manage an inheritance? You might want to revise your will with these circumstances in mind.

8. You change your mind. Your decisions regarding beneficiaries, legal representatives, or guardian to your minor children are not etched in stone. If you've had a falling out with a beneficiary or feel that another individual is more equipped to serve as your executor, or guardian to your minor children, that needs to be addressed as soon as possible by amending your will.

9. Your assets increase/decrease. Any change in your financial circumstances needs to be addressed in your will. When you acquire additional assets, include them in your will to distribute them to align with your wishes and values. If you experience significant liabilities, you should update your will to indicate how these issues will be managed to mitigate any impact they will have on your beneficiaries' inheritance.

10. You relocate. While most states recognize out-of-state wills, specific provisions and regulations may differ. It is recommended that you consult with an estate planning attorney in your new state to ensure your will meets all the requirements. If you move to another country either permanently or for an extended period, it is essential that you review your estate plan and legal documents prior to leaving. Your existing will may not be valid in your new country, and you may have to create a new will or an international will governed by an organization like the Hague Convention to ensure that the will is recognized across countries.

11. You have not reviewed your will in years. Estate planning attorneys recommend that you review your will every five years even if you have not experienced a life-changing event. Doing so can keep you abreast of changes in state and federal laws and regulations that could impact your estate plan.

How to update your will

The best way to update your will is by revoking a will and drawing up a new one in consultation with an estate planning attorney. To do this, simply include a statement in the new will stating that you revoke all previous wills and codicils. This language will revoke any previous wills. It is recommended that you destroy any previous wills to avoid confusion or challenges to your new will.

However, if you only need to make minor changes to your will, you can add an amendment, called a codicil. A codicil is a separate legal document containing modifications to your existing will, including a new provision to add or anything you wish to revoke. A codicil must be executed with the same formality as the original will to be valid, that is, it needs to be signed, dated, and witnessed. In this circumstance, the previous will is still valid along with the codicil.

Codicils can be tricky, so it's best to seek the counsel of an estate planning attorney. Moreover, if you accumulate changes over time, it might be best to create a new will to avoid confusion and mistakes in interpretation and execution.

Mistakes to avoid when updating a will

• Don't delay. Circumstances can change in a literal heartbeat, so it's essential that you act promptly to avoid any unintended consequences in the distribution of your assets.

• Don't DIY. While there are several DIY will-makers available, crafting a will is a serious undertaking that is best left to the pros to ensure that it is valid and tailored to your specific needs.

• Keep current. Make sure all relevant parties have copies of your current will to ensure that your wishes are followed without confusion or delay.

Mackenzie Scott rocked the philanthropic world by donating half of her $36.8 billion divorce settlement from ex-husband and Amazon co-founder Jeff Bezos, setting a record for the largest distribution by a living individual to charity.

Not all donors who wish to support a charitable cause are prepared to give away assets today.

Fortunately, there is a way to give without impacting your financial schedule. It's called a bequest.

A bequest is a simple and easy way to leave a gift to an individual or organization through your will or trust after your death. It costs you nothing now but provides a nonprofit with long-term financial security, while creating a legacy for you.

Not surprisingly, bequests have become the most popular planned giving vehicle. Donors gave almost $43 billion through bequests in 2023, representing 8 percent of total charitable giving, according to Giving USA's 2024 report. Indeed, bequests are driving an increased interest in planned giving as Baby Boomers reach their golden years and Gen Xers approach retirement.

Why have bequests become so popular? Two reasons: simplicity and flexibility. Making a bequest is easy, simply include a bequest provision when creating or revising your will or revocable trust. You can even add the provision to an existing will through a codicil.

Bequests also offer donors seven options when it comes to determining who gets what, when and how. By combining the different types of bequests in a will, you can craft a document that spells out exactly how you'd like your assets distributed, leaving a legacy that closely aligns with your wishes and values.

The seven types of bequests are:

1. General Bequests. A general bequest specifies an exact dollar amount rather than personal effects or real estate. For example, a general bequest might read: "I hereby leave $250,000 to my nephew, John Doe."

2. Demonstrative Bequests. Like general bequests, demonstrative bequests can describe a specific dollar amount, but unlike general bequests, demonstrative bequests specify the account the gift comes from. For example, a demonstrative bequest might read, "I hereby leave $100,000 to my granddaughter, Jane Doe, from my account at Charles Schwab."

3. Specific Bequests. As its name suggests, specific bequests describe a provision in which you leave specific assets to a beneficiary. Bear in mind, it's important to include a detailed description of the items for identification purposes. Including these details can help prevent family strife, as these assets can be difficult to identify and cannot be distributed equally. For example, which set of pearl earrings does grandma want to leave to which of her granddaughters?

4. Percentage Bequests. These bequests can account for changes in the value of an estate over time due to changing market conditions or unexpected expenses. Percentage-based distributions can be more equitable, especially among multiple beneficiaries. In this scenario, each beneficiary receives a proportional value of the estate, which can prevent hard feelings.

5. Conditional Bequests. As you might guess, these bequests can be fulfilled only when certain conditions are met. This means the bequest is not guaranteed, making it unique among the various types of bequests. A conditional bequest might read: "I hereby leave $30,000 to my granddaughter Anna but only on the condition that she graduates from a four-year university before the age of twenty-three."

6. Contingency Bequests. A contingency bequest can only be fulfilled if a specific event occurs at the time of the testator's death. These bequests provide for a back-up plan to ensure that assets are distributed as intended if the primary beneficiary cannot, for any reason, receive them. The secondary beneficiary can be either a person or a charity. For example, a testator whose wife and only child pre-decease him can leave the estate to a charity.

7. Residuary Bequests. Residuary bequests use the remainder of the estate after all distributions have been allocated, and all expenses paid. If a testator fails to name an executor, if there is no will, or if the will does not include a residuary directive, the residuary can be parceled out according to the laws of the state.

In re: Taxes

Most people don't have to worry about estate or inheritance taxes. However, certain types of taxes on inheritances, including capital gains and income taxes are far more common.

An estate planning attorney can help you set up your estate in a way that minimizes taxes for your beneficiaries.

If you've received an inheritance, an estate planning attorney or financial professional may be able to help you reduce your tax burden.