As a person prepares to make an estate plan, he or she will obviously think of the most valued things in life. For many people, family and close friends immediately come to mind. In other cases, some people also place a high value on benefitting certain causes. As such, it is possible to include estate planning tools for the purpose of charitable giving.
One way that individuals may consider giving money to non-profit organizations is by creating a charitable trust. Through this legal entity, an individual’s estate can disburse money over the course of many years. Not only that, the money can be given in a way consistent with the benefactor’s wishes.
In 1992, Daniel K. Ludwig passed away with a considerable fortune to his name. Ludwig became a billionaire in the shipping industry. However, he decided to leave a footprint in cancer research and treatment during and after his lifetime.
Ludwig created a charitable trust to fund cancer research. This year alone, six medical institutions will receive cancer-related funding totaling $540 million. These payments were the final gift given by the billionaire’s estate and trust fund.
The goal of Ludwig’s trust was to fund cancer research for an extended period of time or until the disease no longer posed a serious threat. Of course, the money is given conditionally. The money from the Ludwig trust should be used to help create positive clinical outcomes through researching ways to put an end to cancer.
Although many people might have an estate quite as large as Ludwig’s, there are still opportunities to use trusts, or other legal tools, to make charitable giving a priority during estate planning. These types of tools help cement personal legacies in a lasting, tangible way.
Source: ScienceMag.org, “A Billionaire’s Final Gift to Six U.S. Cancer Centers,” Jan. 6, 2013