Kiwis these days are more inclined to choose a charitable trust among other kinds of trusts. One of the most common questions we’ve been receiving for the last couple of weeks is “What is a charitable trust?”
There is a follow-up on that question and that is “Who can benefit from a charitable trust?” We will answer these two questions and then we will go on to answer more. So, if you are seriously considering a charitable trust, then we thank you and here is everything you need to know.
What is a charitable trust?
A charitable trust is a legal arrangement that protects some or all of your assets that are meant for charitable purposes. For example, you want to donate money to UNICEF long before you are gone, then a charitable trust will do that for you.
A charitable trust allows you to support causes and programs continuously despite your demise. In short, you are making the world better for so many people. You can choose the charity you want, and you can choose more than one.
Some people diversify their trust portfolio by adding a charitable trust. For example, an individual has a family trust he wants to leave for his family, mainly for financial reasons. He can also commit to a charitable trust that would give him the ability to help out those in need.
For a charitable trust to work best, one must be able to have enough money for ongoing charitable capital growth or gifting. That mostly requires at least $200,000 initial contribution. However, if your budget is lower than this, then you can still push through with a charitable trust.
You can do so by adding to an existing trust.
Who can benefit from a charitable trust?
You get to choose the charity you want to support. So, you get to choose the people you want to benefit. You can choose a charity that takes care of people in the poverty line. You can choose a charity that helps people with disabilities. You can support a charity that offers free education to the less fortunate.
Bottom line, the people to benefit from a charitable trust are the people who need your help. Keep in mind that you can choose more than one charity. However, that also means a larger contribution.
But it is still a great feeling knowing you are going to help out so many people. You are also going to inspire maybe a member of your family, a co-worker or a friend.
How do I get started?
Well, first, you need to choose a charity or an organisation. With that, you can get in touch with them to get more information about their programs and initiatives. Next, you need to ask for professional legal services to help you out.