Introduction to Planned Giving Generous Stewardship Ministry The Free Methodist Church in Canada

Introduction to Planned Giving

Generous Stewardship Ministry

The Free Methodist Church in Canada

Planning Giving?

70% of Canadians do not understand what “Planned Giving” is Annual Gift Plan (giving while you are living) Planned/Estate Giving (giving after you are gone)

90% of Planned Giving is through bequests (wills)Most lawyers do not know/understand ‘Planned

Giving’ or the effect it may have on estate taxes

People do not know what they do not know….

PLANNED GIVING

Download the FMCiC Will Planning Guide from fmcic.ca (stewardship ministry section)

You need a Current Estate Plan if you…

Have DependantsOwn a Home/Property Have RRSP/RRIFHave Insurance PoliciesHave SavingsOwe Debt


Without an Estate Plan…

You have no say in how your property is distributed

Church/Charities get nothing Your dependants may not receive

enough Your children may receive too much too

soon No opportunity to select a guardian Your estate may pay more taxes Your funds/property may be frozen

(probate) You family may/will fight over it


Simplest Estate Plan...

Give away all your possessions before you die “Go sell all your possessions and give the money to the

poor, then come and follow me…” (Matt. 19:21)

Owe nothing to no one Let no debt remain outstanding, except for the debt of

love (Romans 13:8)

Download Biblical Principles on Stewardship VERSES

But Remember…

Look after your family… Parents ought to save up for their children (2 Cor. 12:14) If anyone does not provide for his relatives, and especially

for his immediate family, he has denied the faith and is worse than an unbeliever (1 Tim. 5:8)

Look after your neighbour… Love your neighbour as yourself (Luke 10:25-37) All the believers were together… selling their possessions

and giving to anyone as they had need (Acts 2:44-45)Seek first the Kingdom…

Do not store up for yourselves treasures on earth… but store up treasures in heaven (Matt. 6:19-20)


Cultural Messages…

• He who dies with the most – wins• You must protect your future &

family (someone else will look after the rest)

• You can always have/use/need more

• You Deserve it, because You earned it!

• Give only after you are gone if there is anything left (spend it before you go)

• What I do with my money is my business (it is not your money!)

Biblical Principles…

• Don’t worry – seek His Kingdom first and build a treasure that will last in heaven (Matt. 6:28-34)

• Don’t put your trust in wealth – but be rich in good deeds & willing to share (1 Tim 6)

• Enough is never enough (So stop trying to get enough) (Eccl. 5:11 )

• You’ve been blessed – so that you can bless others (2 Cor. 8:14 & 1 Tim. 6:17-18)


Be Prepared to Give an Account…

“What did you do with what I gave you ?” (whether you thought it was a little or a lot)


Plan to be Generous…

GAIN all you can

SAVE all you can

GIVE all you can

~ John Wesley ~

Common Planned Giving Options

GIFTS OF CASH & PROPERTY INTEREST FREE LOANS

BEQUESTS – GIFTS UNDER WILL LIFE INSURANCE

(OUTRIGHT/BENEFICIARY)

PUBLICALLY TRADED APPRECIATED SECURITIES

RRSP / RRIF (PORTFOLIOS & PARTIAL DRAW-DOWNS)

ENDOWMENT FUND (FMCIC FOUNDATION/LORNE PARK FOUNDATION)


Start by Asking the Right Questions…

How little do I need to keep?How much does my family

really need (vs. want)?What is GOD saying to do

with the rest?Heart Check –

“Am I giving only to get something?” Tax Benefit, Recognition/Control/Legacy

Ask the Right Questions….

Does the plan need to be revocable / reversible?

Bequests (Wills) Insurance Policies RRSP/RRSP


Is it better to get the tax credit now? Outright Gift of cash, property, RRSP Portfolio Appreciated Securities Insurance Policy owned by Charity Interest Free Loans (interest portion) Charitable Gift Annuity Endowment Fund (unless a bequest) *

Or have my estate benefit from a tax credit? Bequest under a Will RRSP / RRIF Insurance Policy with Charity as beneficiary Endowment Fund through Bequest*

* Contact FMC Foundation or Lorne Park Foundation


Will my choice be subject to PROBATE? Bequests under a Will (usually)

Obtain advise from qualified planner/lawyer


Does I need to generate income during my lifetime?

Charitable Gift Annuity Charitable Remainder Trust Gift of Residual Interest/Property



Do I want the ministry to use my gift immediately?

Outright Gift of Property/Cash Outright Gift of Appreciated Securities Outright Gift of RRSP/RRIF * Interest Free Loans Portion of RRSP/RRIF given now Endowment Fund

* CAUTION – ensure you have enough to handle life without RRSP/RRIF


Do I need a Lawyer? Financial Advisor? Tax Accountant? All of the Above?

Who are you going to call?

“A WISE MAN LISTENS TO ADVISE” (PROVERBS 12:15)

“WITHOUT GOOD DIRECTION, PEOPLE LOSE THEIR WAY;

THE MORE WISE COUNSEL YOU FOLLOW,

THE BETTER YOUR CHANCES” (PROVERBS 11:14)

“BLESSED IS THE ONE WHO DOES NOT WALK

IN STEP WITH THE WICKED…” (PSALM 1:1)

Getting the Right Professional Advice

EACH GIFT PLAN IS UNIQUE; FIND SOMEONE THAT CAN

EXPLAIN IT SO THAT YOU CAN UNDERSTAND IT

WITH THE RIGHT CREDENTIALS: Certified Financial Planner (CFP)

Chartered Accountant (CA) – specializing in financial planning

Personal Financial Specialist (PFS)

WITH THE RIGHT VALUES:Advisors with Purpose: advisorswithpurpose.caChristian Stewardship Services: csservices.ca

Responsible/Ethical Investing


Bequests made to the Church


Be both generous & specific in your will, but remember to keep it simple.

The more complicated you make conditions, the harder (and costlier) it is for the ministry to use your gift.

Remember that churches sometimes change their names and some close their doors; Word your bequest in such a way that if this happens, your executor can still honour your wishes.

Don’t forget to keep on giving while you are living.

Planned Giving Options


Make church/charity beneficiary (after spouse) on RRSP / Insurance

Add clause in Will – “bring Estate Taxes to Zero” through giving to named charities

Consider “Child called Charity” Consider “Legacy Fund” where

Church/Charity receives funds over 20 years

Legacy Gifts

Richard Radcliffe – Legacy Fundraising Consultant, UK

Legacies are not about death – they’re about the future life of ministries and charities / people / the world.

Legacies are life driven – death activatedLegacies cost nothing nowLegacies are an investment, not a gift – can

you be trusted with it?

Bequests made to the Church


Recommended statement (or similar wording):

“For the (name of ministry/ongoing ministry) of (Local Church Name)

Currently situated at (address of local church/Ministry). If, through the passage of time, this bequest becomes obsolete,

permission is given to alter the terms adhering as closely as possible to my original wishes.

Should the (Local church/ministry name) no longer exist, the funds should default to The Free Methodist Church in Canada, currently situated at 4315 Village Centre Court,

Mississauga, ON L4Z 1S2, to be used for ongoing ministry.

Gifts of Publically

Traded Securities

Contact FMCiC Director of

Administrative Services

Gifts of Publically Traded Securities

Assumes top tax bracket (46%)

Sell Shares and Donate Proceeds

Donate Sharesto the Church

1. Value of the Shares $50,000 $50,000

2. Original Purchase Price $20,000 $20,000

3. Capital Gain $30,000 $30,000

4. Taxable Gain (Line 3 x 50%)

$15,000 $0

5. Donation Tax Credit (Calculated at 46%)

$23,000 $23,000

6. Tax on Capital Gain (Line 4 x 46%) $6,900 $0

7. Net Tax Savings (Line 5 - Line 6)

$16,100 $23,000

8 Donation Receipt $50,000 $50,000

$6,900 in tax savings by donating the shares to the churchinstead of selling them and donating the proceeds.

(NOTE: The actual tax savings depends on your specific situation)

Modified from "Planned Giving , The United Church of Canada, Gifts of Publically Traded Securities. Actual tax savings

depends on your specific individual tax situation. Seek independent tax advice for your specific situation.

http://www.united-church.ca/files/getinvolved/donate/howto/planned/resources_09.pdf

What does the Church Need to Do?

Celebrate Generosity Encourage Generosity

Plan Generosity Thank Generosity

Church Gift Acceptance Policy

“SPENDING OF FUNDS IS CONFINED TO PROGRAMS AND PROJECTS APPROVED BY THE

CHURCH BOARD. EACH CONTRIBUTION RESTRICTED FOR USE IN SUCH AN APPROVED

PROGRAM OR PROJECT WILL BE SO USED WITH THE UNDERSTANDING THAT WHEN THE

NEEDS FOR SUCH A PROGRAM OR PROJECT HAS BEEN MET, OR CANNOT BE COMPLETED FOR ANY REASON AS DETERMINED BY THE

CHURCH BOARD, THE REMAINING RESTRICTED CONTRIBUTIONS WILL BE USED

WHERE NEEDED MOST.”

NOTES: EVERY EFFORT MUST BE MADE TO USE FUNDS FOR

THEIR ORIGINAL DESIGNATED USEBUILDING FUND DESIGNATION IS SOMETHING

THAT WOULD REMAIN RESTRICTED (BECAUSE THERE IS ALWAYS A BUILDING)

Planned Giving Policies & Guidelines

REAL ESTATE & GIFTS IN KIND LEGAL ISSUES

ETHICAL ISSUES PRACTICAL CONSIDERATIONS

CONFIDENTIALITY

Church Gift Plan

GIVE SOMESAVE SOMEPAY SOMEUSE SOME

What can you do now?

Start a plan to be generousSteward all your resources to make

the most of what God gives you – both now and after you’re gone

Get the right advisor (s)(financial, tax, accounting)

Get the right legal adviceGet/Update willLive Generously now

“We ought not to forbid people to be diligent and frugal: we must exhort all Christians, to gain all they can,

and to save all they can... What way then (I ask again) can we take that our money

may not sink us to the nethermost hell? There is one way, and there is no other under heaven. If those who gain all they can, and save all they can,

will likewise give all they can, then the more they gain, the more they will grow in grace,

and the more treasure they will lay up in heaven."

John Wesley

Cited from The Works of the Rev. John Wesley, vol. XV (London: Thomas Cordeux, 1786).

Generous Stewardship Ministry

THE FREE METHODIST CHURCH IN CANADA

Documents

Introduction to Planned Giving Generous Stewardship Ministry The Free Methodist Church in Canada